The new joint venture – GEF Foods India Pvt. Ltd. – will make and distribute masalas, meal mixes and the like.
Following the formation of a new joint venture, Annapoorna, a 50-year-old masala brand owned by the Coimbatore group, will now be a part of GEF Foods India Private Ltd.
Gemini Edibles and Fats India is entering the spices business through GEF Foods Pvt. Ltd. as part of its diversification strategy. The joint venture is expected to benefit from the deep market knowledge and distribution network of GEF India and help grow Annapoorna masalas.
In an email response, Akshay Chowdhry, Group Vice-President, Gemini Edibles and Fats India Ltd., fields a range of questions on the new joint venture. Excerpts:
What is the capital base of the new venture?
The new venture – GEF Foods India Pvt Ltd. – will have a capital base of Rs. 70 crore.
Where will the new joint venture be located?
It will be headquartered out of Hyderabad.
What is the board composition of the new joint venture?
Managing Director will be Vijay Prasad. Three non-executive directors will be nominated by Gemini Edibles and Fats India Ltd., the majority shareholder of GEF Foods.
What is the size of the two companies?
The size of Gemini Edibles is approximately Rs. 9,500 crore in FY 23-24 and that of Sree Annapoorna Foods Rs .43 crore in FY 23-24.
Why the joint venture?
Gemini Edibles wanted to expand into adjacent categories and in spices. We found a category that is growing at a double-digit rate in the branded space. It is also a kitchen staple like edible oils. We found this to be a suitable category to enter as complementary to our existing business.
What will the existing companies do now?
Gemini Edibles will continue its edible oils business. The promoters of Sree Annapoorna Foods are now shareholders in GEF Foods and will no longer carry on any spices business in their old firm. GEF Foods will do the spices business under Annapoorna brand name going forward.
Is the brand licenced to the new joint venture?
The brand has been sold for Rs. 50 crore to GEF Foods. A further Rs. 20 crore capitalisation has been done for working capital purposes. Total investment into GEF Foods is Rs. 70 crore.
What is the way forward?
We will endeavour to grow this legacy brand of Tamil Nadu, a 50-year-old spices brand. We will strengthen its presence within Tamil Nadu first and, over the next five years, take it to the other southern states. We aim to become a leading spices brand in the country over the years.
