Haldiram’s looks to buy majority stake in Yellow Diamond chips maker Prataap Snacks: Report – Times of India

by The Technical Blogs


Haldiram’s, the Indian snacks maker, is in discussions to acquire a majority stake in Prataap Snacks, a listed rival which is valued at $350 million. The aim of this acquisition is to expand Haldiram’s presence in the potato chip market.
According to a Reuters report, the talks are in the early stages and the valuation has not yet been discussed. However, it is expected to be at a premium to Prataap’s stock price. Haldiram’s is looking to acquire a majority stake of at least 51%, although the final percentage has not been decided, sources were quoted as saying.
Prataap Snacks, known for its Yellow Diamond brand of chips, competes with Pepsi’s Lay’s brand and other snack-makers in a market where local, unorganized food sellers dominate the fried chips segment.
Peak XV Partners, formerly known as Sequoia Capital India, possesses approximately 47% of Prataap Snacks and is actively seeking a complete divestment of their stake in the company, as per the report.
The CEO of Haldiram’s, Krishan Kumar Chutani, the CEO of Prataap, Amit Kumat, and Peak XV Partners, all declined to comment.
Prataap made its debut in the stock market in 2017 and reported annual revenues of around $200 million last year. It sells over 12 million packets of its snacks daily at prices as low as Rs 5 (6 US cents).
Haldiram’s, on the other hand, is a much larger manufacturer of packaged snacks with revenue of over $1 billion and a network of 150 restaurants across the country. Last year, Haldiram’s was in deal talks with conglomerate Tata Group and other strategic investors for a potential $10 billion valuation, but the discussions did not materialize due to concerns over valuation.
This deal with Prataap will allow Haldiram’s to tap into the potato chips segment, as consumers often prefer western flavored snacks over local ones, a source said.
Prataap operates 14 manufacturing plants across nine Indian states. While smaller unorganized companies dominate the fried snacks market in India, branded products have experienced significant growth in recent years due to increased health consciousness and higher disposable incomes.
Despite facing inflationary pressures and rising competition in the price-conscious Indian market, Prataap remains optimistic about the snacks market, estimating the snacks market worth at $5.2 billion with an annual growth rate of 14%.


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