ITC Ltd announced it is going to acquire 100% in the makers of the health-conscious brand Yoga Bar, Sproutlife Foods Pvt Ltd, in an all-cash deal over the next 3-4 years. The conglomerate will pay Rs 255 crore for 47.5% stake in the company in multiple tranches by March 2025 and the balance will be acquired on the basis of pre-defined valuation criteria, subject to other conditions agreed to in the binding documents, as per a stock market disclosure.
The move will allow ITC to expand presence in the Rs 45,000 crore fast growing, nutrition-led healthy foods space. ITC said this deal is in line with its ‘ITC Next’ strategy articulated by chairman Sanjiv Puri that focuses on building a future-ready portfolio of products that serve evolving consumer needs.
ET broke the story of ITC eyeing to buy Yoga Bar on September 23.
ITC Ltd divisional chief executive (foods division) Hemant Malik said this investment is an exciting opportunity that aligns with ITC’s foods business’ aspiration to build a formidable portfolio in the nutrition-led healthy foods space. “We look forward to scaling the Yoga Bar brand offering superior and healthy consumer choices,” he said.
Sproutlife Foods had clocked Rs 68 crore sales in 2021-22. Yoga Bar has built a product portfolio of nutrition bars, muesli, oats and cereals with a high salience of online sales and a growing presence in offline stores. The brand is a leader in the bars segment and has built a strong market position in the muesli segment.
In a media statement, Sproutlife Foods co-founders Suhasini Sampath Kumar and Anindita Sampath Kumar said the partnership with ITC will add to Yoga Bar’s competitive advantage and take it to the next level from the current annualised run rate of over Rs 100 crore.
“We are delighted that ITC and Yoga Bar will work together to build one of the largest brands in the healthy foods space,” they said. The company was founded by the sister entrepreneurs in 2014.
Marico, ITC and Hindustan Unilever have been investing in D2C brands that gained huge momentum during the Covid-19 pandemic when online shopping saw a major uptick.
In May last year, Marico picked up a 54% stake in HW Wellness Solutions, which owns healthy breakfast and snacks brand True Elements. Over a year ago, Tata Consumer acquired a 100% stake in Kottaram Agro Foods, the maker of Soulfull brand of breakfast cereals and millet-based snacks.
Last month, Hindustan Unilever Limited said it is investing in Zywie Ventures, which sells plant-based supplement brand Oziva, and Nutritionalab, which owns nutritional products under Wellbeing, to enter the health and wellness market worth Rs 30,000 crore.
