On Thursday, Reliance Consumer Products (RCPL), the FMCG subsidiary of Reliance Retail Ventures (RRVL), issued a press release confirming the finalization of its acquisition of a controlling interest in Lotus Chocolate Company Ltd.
RCPL has finalized the acquisition of a 51% ownership interest in Lotus Chocolate for a combined sum of INR 74 crore. In addition, RCPL has made an investment of INR 25 crore by subscribing to non-cumulative redeemable preference shares of Lotus.
According to its statement, RCPL has successfully concluded the acquisition of equity shares through an open offer conducted in accordance with SEBI Takeover Regulations. As of May 24, 2023, RCPL has assumed complete control of the company.
In late December, RCPL announced its intention to acquire a 51% stake in Lotus Chocolate Company for INR 74 crore. Additionally, RCPL expressed its plans to acquire an additional 26% stake through an open offer.
In a statement, the FMCG division of Reliance Industries stated that the capital infusion would support the growth and expansion of Lotus. The funding would enable Lotus to become a versatile manufacturer of confectionery, cocoa, chocolate derivatives, and related products, catering to both industrial and consumer markets.
“The investment in Lotus underlines our commitment to further boost indigenously developed daily use high-quality products, to serve a broad customer spectrum at affordable prices,” Isha Ambani, the Executive Director of Reliance Retail, was quoted as saying in the release.
The chocolate company posted sales of INR 87 crore during the year ended March 2022 with net profit of INR 6 crore. “We are delighted to enter into this partnership with Reliance. We have a vision to build a world class confectionery products business across customer segments backed by best-in-class manufacturing capabilities and talent. Our strategic partnership with Reliance, through this investment, will further enable this vision and accelerate Lotus’ transformation,” Abhijit Pai, Founder-Promoter of Lotus, said.
Reliance Retail’s acquisition of Lotus Chocolate aligns with its strategic objective of expanding its presence in the fast-moving consumer goods (FMCG) sector, which the company recently entered. This move positions Reliance’s subsidiary to enter into competition with confectionery manufacturers such as Britannia Industries and Nestle India.
RRVL, a subsidiary of Reliance Industries led by Mukesh Ambani, serves as the holding company for all retail enterprises within the Reliance Industries Limited (RIL) group.
During the annual general meeting held in August 2022, Mukesh Ambani, the Chairman of Reliance Industries Limited (RIL), unveiled the conglomerate’s intention to venture into the thriving fast-moving consumer goods (FMCG) sector.