Heritage Foods, the Hyderabad-based company, has signed an agreement to purchase the dairy business of Reliance Retail. The proposed transaction is subject to regulatory approvals and other conditions and procedures that are customary for similar transactions.
Reliance Retail’s dairy platform offers a range of products that includes milk, flavoured milk, butter, ghee, curd, sweets and other milk products. In the last financial year, the company generated a revenue of Rs.553 Crore and currently procures 225,000 litres of milk a day from over 2,400 villages in the country.
According to a company statement, Reliance Retail will continue to trade in dairy products that include products by Heritage through its retail and wholesale channels after the acquisition. The managements of both companies believe that this acquisition will allow the brands to tap into new opportunities in Punjab, Uttarakhand and Rajasthan.
Founded by Andhra Pradesh CM, N Chandrababu Naidu, Heritage Foods came into the market in 1992. The brand has five divisions that cover everything in the retail section – dairy, retail, agriculture, bakery and renewable energy. There are over 100,000 retail outlets across the country that sell and market these products.
Future Group was in talks to buy the retail business of Heritage Foods, but the business collaboration was not discussed and finalised beyond that. The company’s revenue stood at Rs. 641 crore in September 2016 while they were at Rs. 586 crore last year.