Nestle to Compete in Acquiring the Manufacturer of Chings Chinese in a Deal of More than $1 Billion
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According to a close source familiar with the situation, Nestle SA, the largest food company in the world, is one of the last bidders vying to buy India's Capital Foods Ltd. in order to increase its position in the rapidly expanding economy. The persons, who asked to remain anonymous because the information is confidential, said that the Swiss company has been talking about the parameters of a potential transaction for Mumbai-based Capital Foods.
Any purchase would certainly be worth more than $1 billion for the Indian company. Over the past 12 months, shares of Nestle's listed Indian division have increased 10% in Mumbai trading, boosting its market value to around $22.3 billion. In India, the company opened its first manufacturing unit in 1961. It distributes a variety of products there, including cereals and yogurt. General Atlantic, an investor in Capital Foods, acquired a stake in the firm in 2018.
Ching's Secret brand spicy noodles and fusion chutneys with purportedly "desi Chinese" characteristics are produced by Capital Foods. It also offers masala blends and culinary pastes made by Smith & Jones. Even while negotiations for a potential merger are far along, a number of other parties have also expressed interest in purchasing Capital Foods, so there is no guarantee that Nestle will end up winning the deal, according to the sources.
People in India consume Chings Chinese products frequently. It has emerged as a competitor to likes such as Maggi, Top Ramen, etc. With diversification into the noodle and desi Chinese market in India, Capital Foods Ltd. has given new options to consumers, and doing quite well among food fanatics. It will be interesting to see the changes in the product line and other counterparts once Nestle or any other company that cracks the deal, takes over.
