Haldiram's wants to acquire majority stake in Prataap Snacks
Haldiram's, a leading Indian snack manufacturer, is in preliminary talks to acquire a majority stake in competitor Prataap Snacks, a company valued at $350 million. The goal is to expand its footprint in the potato chip market. Haldiram's is considering a stake of at least 51%, with the final percentage yet to be decided. The deal's valuation has not been disclosed but could be higher than Prataap's stock price.
Peak XV Partners is looking to exit Prataap Snacks
Peak XV Partners, a venture capital firm formerly called Sequoia Capital India, owns about 47% of Prataap Snacks and plans to sell its entire stake. Prataap, famous for its Yellow Diamond chips, competes with brands like Pepsi's Lay's in a market where local, informal food vendors still rule the fried chips sector. The company went public in 2017 and reported annual revenues of approximately $200 million last year.
Potential benefits of the deal for Haldiram's
A partnership with Prataap would allow Haldiram's to enter the potato chips market, as consumers often favor western-style snacks over local options. Prataap operates 14 manufacturing plants spread across nine Indian states and is part of a growing $5.2 billion snack market with an annual growth rate of 14%. However, local snack producers like Prataap face challenges due to inflation and increased competition in India's price-sensitive market, with its stock price remaining near its 2017 listing level.
Brief info about Haldiram's
Founded in 1937, Haldiram's is a family-run business. It is a much bigger packaged snacks manufacturer than Prataap, with revenue of over $1 billion. It also runs 150 restaurants across the country. In 2023, Reuters reported that Haldiram's was engaged in deal talks with Tata Group and other strategic investors, and was seeking a $10 billion valuation. However, the deal did not materialize over valuation concerns.
