Temasek Seeks CCI Approval To Acquire Stake In Haldiram

Temasek Seeks CCI Approval To Acquire Stake In Haldiram

The deal involves less than 10 percent of equity share capital, without anticipating competition concerns

Singapore’s sovereign wealth fund Temasek Holdings has sought the approval of the Competition Commission of India (CCI) to acquire a 10 percent stake in Haldiram Snacks Food Pvt Ltd, India's largest packed snack and sweets company, for USD 10 billion.

Haldiram’s owner, the Agarwal family, is likely to bring in another investor and consider an Initial Public Offering (IPO) next year to fund its expansion plans and capitalize on India's buoyant stock market.

The company operates snacks and food restaurants through its arm, Jongsong Investments Pte.

A notice filed by the CCI read, “The transaction is in the nature of an acquisition of shares, voting rights and falls under Section 5 of the Competition Act, 2002.”

In its submission to the CCI, Jongsong and Haldiram asserted that the proposed transaction would not raise any competition law concerns. However, the relevant markets may be considered as a broader space to manufacture and sell packaged food products in India.

The entities added that narrower markets may be identified within the segment, including the manufacturing and sale of snacks, sweets, ready-to-eat, dairy and bakery products, chocolates and non-carbonated ready-to-drink beverages.

Haldiram’s agreement with Temasek came after months of negotiations as several private equity firms, including Blackstone, Alpha Wave Global and Bain Capital-led consortiums, were in the race.

While earlier, the promoters intended divesting a larger portion, they opted to offload a minority stake.

This cash infusion will help Haldiram to fund its expansion plans and expedite its journey in the domestic as well as some of the foreign markets where it has a presence.

Haldiram is the combined business of the two fractions of the Haldiram family - Delhi and Nagpur.

Meanwhile, the National Company Law Tribunal (NCLT) has already approved the merger of the two fractions, though they await other regulatory approvals.

Established in 1937 as a retail shop of sweets and namkeen in Bikaner, Rajasthan by Ganga Bhishen Agarwal, Haldiram products are now sold in over 80 countries.

In 2022, it was announced that the packaged snacks businesses of Delhi-based Haldiram Snacks and Nagpur-based Haldiram Foods International would be first demerged and then merged into an entity named Haldiram Snacks Food.