The French dairy major will acquire a share of Britannia’s wholly-owned subsidiary Britannia Dairy Private Limited, which will be renamed Britannia Bel Foods Private Limited.
Bel paid INR2.62bn (US$32.1m) for its stake and the deal is expected to be closed on Friday (2 December). The venture will take control of development, manufacturing, marketing, distribution, trading and sales.
The Laughing Cow and Babybel brand owner said it wanted to tackle India’s “nascent cheese market”.
In a statement today, it said: “By joining forces through the JV, Bel Group and Britannia will create the best conditions to accelerate the development of the nascent cheese market in India thanks to the strategic complementarity of the two companies.
Britannia Industries will hold a 51% stake in the joint venture company. The unit’s turnover for the financial year 2021‐22 was INR3.4bn of which INR2.1bn was brought in by cheese. The subsidiary formed around 2.4% of Britannia’s overall sales.
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The deal comes months after Bel further bolstered its presence in emerging markets with a 70% share of Chinese cheese maker Shandong Junjun Cheese Co.
Bel, which has an office in China, said it had struck the deal “to accelerate its growth” in the country. Financial terms were not disclosed.
In May, Cécile Béliot took up the newly created position of Bel group CEO, the first time the role had been separated from the position of chairman. In July, the company announced a deal to sell the controlling stake in Morocco’s Safilait. Bel sold the shares, which it had held since 2015, to Polish dairy player Polmlek.
A board of directors will be formed for the new JV including three members nominated by Britannia and two by Bel.
Britannia and Bel have also committed to inject an additional INR2.15bn and INR2.07bn respectively into the JV within the first month in a bid to boost business.