Reliance Consumer Products, a subsidiary of Reliance Retail Ventures, has made a significant move in the FMCG sector by acquiring the confectionery business of Ravalgaon Sugar Farm.
The Rs 27-crore deal brings the 82-year-old candy brand's trademarks, recipes, and intellectual property rights under Reliance's expanding FMCG portfolio.
Known for brands like Campa, Toffeeman, and Raskik, Reliance aims to widen its consumer offerings with this acquisition.
What led to the acquisition?
Ravalgaon Sugar Farm, a name synonymous with childhood memories for many, has been struggling to maintain its market presence amidst fierce competition and rising costs.
With iconic candies like Pan Pasand and Coffee Break, Ravalgaon has been a staple in the Indian confectionery market. However, the surge in competition from both organized and unorganized sectors and the inability to pass on rising input costs to consumers has led to a decline in market share and profitability.
What stays with Ravalgaon?
Despite selling its confectionery business, Ravalgaon Sugar Farm will retain its other assets, including property, land, plant, and machinery.
The company said the deal does not encompass the sale of all assets and liabilities of the company. The move allows Ravalgaon to focus on its remaining operations while passing on the candy brand legacy to Reliance, it said.
Reliance Consumer Products Ltd. is not new to acquisitions in the FMCG space. With the recent launch of its consumer packaged goods brand 'Independence' and the acquisition of the home-grown soft drink brand Campa, Reliance is aggressively pursuing growth in the fragmented FMCG sector.