Tata Global acquired US Coffee brand Eight O'Clock for $220 million, half of the size of Tetley's $450 million.
Six year after it made its last major acquisition, Tata Global
Beverages is again gearing up to gobble up few more international brands
with an aim to emerge as a global beverage company of enviable size,
said R K Krishna Kumar, vice-chairman and a key figure in the Tata
group.
“I believe in the next few years we will make major acquisitions and become a truly unrivalled company not just in tea or coffee but in many areas of beverages. It’s just a dream, though I believe everybody is well set on that path,” Kumar told reporters after the annual general meeting on Monday.
From predominantly a tea planter and marketer, and till recently known as Tata Tea, the company made its first global acquisition, an audacious takeover of iconic British tea brand Tetley, several times its size in 2000.
Then in 2006, Tata Global acquired US Coffee brand Eight O’Clock for $220 million, half of the size of Tetley’s $450 million.
Several international, though much smaller sized, brands like Good Earth or Czech brand Jemca, were picked up on the way, following which 90% of Tata Global’s current revenue comes from branded products sold in 40 countries.
“I don’t want to be very specific about the targets. We have identified a couple of them and shared it all with the team. They will do even exciting things than what we did,” Kumar, who is set to retire soon,
said.
“I am not in a position to share insights on specific companies or targets. All I would say is as a company we are open to growth both organically as well as inorganically,” managing director and chief executive officer Harish Bhat said when asked to react to Krishna Kumar’s comment.
Even as Tata Global prepares for acquiring new brands, it plans to significantly raise spend on existing brands across the globe, mainly to beat the slowdown in discretionary consumption.
“In the next 2-3 years the proportion of expenditure on brand promotion would be quiet an impressive figure,” Kumar said echoing chairman Cyrus Mistry’s views.
“In future we would be investing more and more into our brands. The UK market is currently depressed and we plant to invest significantly in the Tetley brand to see that the market share comes back,” Mistry told shareholders.
Back home, Tata Global need to spend more on rural distributions and strengthen brands like Tata Tea Gold and Tetley, Mistry said.
Among its other brands, Himalayan mineral water would be launched globally, though gradually, while Tata Water Plus, currently being test-marketed in Andhra Pradesh and Tamil Nadu, would be taken national, Bhat said.
Both there brands are being handled by Tata Global’s joint venture with PepsiCo called NourishCo Beverages, which has in the pipeline a whole lot of exciting products, Kumar said.
Meantime, the company told the exchanges that it has decided to develop its property in Bangalore along with group outfit Tata Realty for which it is getting a consideration of Rs195 crore.
It is only a one-off deal for the Yeshwanthpur property and no such similar plans for development of other properties are on the anvil, Bhat said.
“I believe in the next few years we will make major acquisitions and become a truly unrivalled company not just in tea or coffee but in many areas of beverages. It’s just a dream, though I believe everybody is well set on that path,” Kumar told reporters after the annual general meeting on Monday.
From predominantly a tea planter and marketer, and till recently known as Tata Tea, the company made its first global acquisition, an audacious takeover of iconic British tea brand Tetley, several times its size in 2000.
Then in 2006, Tata Global acquired US Coffee brand Eight O’Clock for $220 million, half of the size of Tetley’s $450 million.
Several international, though much smaller sized, brands like Good Earth or Czech brand Jemca, were picked up on the way, following which 90% of Tata Global’s current revenue comes from branded products sold in 40 countries.
“I don’t want to be very specific about the targets. We have identified a couple of them and shared it all with the team. They will do even exciting things than what we did,” Kumar, who is set to retire soon,
said.
“I am not in a position to share insights on specific companies or targets. All I would say is as a company we are open to growth both organically as well as inorganically,” managing director and chief executive officer Harish Bhat said when asked to react to Krishna Kumar’s comment.
Even as Tata Global prepares for acquiring new brands, it plans to significantly raise spend on existing brands across the globe, mainly to beat the slowdown in discretionary consumption.
“In the next 2-3 years the proportion of expenditure on brand promotion would be quiet an impressive figure,” Kumar said echoing chairman Cyrus Mistry’s views.
“In future we would be investing more and more into our brands. The UK market is currently depressed and we plant to invest significantly in the Tetley brand to see that the market share comes back,” Mistry told shareholders.
Back home, Tata Global need to spend more on rural distributions and strengthen brands like Tata Tea Gold and Tetley, Mistry said.
Among its other brands, Himalayan mineral water would be launched globally, though gradually, while Tata Water Plus, currently being test-marketed in Andhra Pradesh and Tamil Nadu, would be taken national, Bhat said.
Both there brands are being handled by Tata Global’s joint venture with PepsiCo called NourishCo Beverages, which has in the pipeline a whole lot of exciting products, Kumar said.
Meantime, the company told the exchanges that it has decided to develop its property in Bangalore along with group outfit Tata Realty for which it is getting a consideration of Rs195 crore.
It is only a one-off deal for the Yeshwanthpur property and no such similar plans for development of other properties are on the anvil, Bhat said.
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