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Lotte Confectionery to acquire Havmor, start Indian ice cream business
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Friday, 24 November, 2017, 08 : 00 AM [IST]
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Our Bureau, Mumbai
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Following the acquisition of India’s fastest-growing ice cream brand Havmor Ice Cream Ltd (HIL), Lotte Confectionery - the South Korean company worth $80 billion - will start its ice cream business in the Indian market, which boasts of a population of approximately 1.3 billion.
Lotte Confectionery decided to acquire 100 per cent of the shares of HIL, one of the largest ice cream brands in India, at the recent meeting of its board of directors. The transaction is to acquire 100 per cent share purchase, and the purchase price is Rs 1,020 crore. The share purchase agreement was executed the same day.
Founded in 1944 and headquartered in Ahmedabad, Gujarat, HIL has been India’s fastest growing ice cream brand over the last five years and has been one of the most sought-after ice cream brands by multinationals and private equity (PE) investors alike.
Havmor boasts of a unique product portfolio, with a significant network of parlours operating across 14 states in India. The company manufactures 150 kinds of products from two plants and sells from about 30,000 dealers.
Meanwhile, Lotte Confectionery was one of the first Korean food and beverage (F&B) companies to enter the Indian market in 2004.
Since then, the $80-billion company has succeeded in localisation by establishing large scale choco-pie factories in Chennai and Delhi.
Last year, Lotte Confectionery reached a market share of 90 per cent in the Indian choco-pie market by making active investments.
Commenting on the developments, Pradeep Chona, chairman, and Ankit Chona, managing director, HIL, said, “This decision was a very difficult one to make. It is a brand that we have nurtured with our team for over 73 years.”
“But we believe that Lotte Confectionery is the right brand to take the company to the next level,” they added.
Lotte Confectionery plans to expand its market power from the north-western region to across India, with its foray into the Indian ice cream market.
Havmor will continue to operate its signature chain of restaurants and eateries across Gujarat, as well as its signature brand and concept café, Huber and Holly.
Havmor worked with its sole financial advisors – KPMG, alongside Veritas Legal and Dhruva Advisors LLP, on the deal. The entire deal will conclude in a week’s time.
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