ITC To Acquire 24 Mantra Organic Maker Sresta Natural Bioproducts For Rs 472.50 Crore In All-Cash Deal

ITC has announced the acquisition of Sresta Natural Bioproducts, the business behind the popular "24 Mantra Organic" brand, as a calculated effort to increase its footprint in the expanding organic food sector. The acquisition, which is worth Rs 472.50 crore, will be paid for fully with cash and is intended to increase ITC's presence in the organic food market.

ITC has entered into a share purchase agreement with Sresta Natural Bioproducts Private Limited (SNBPL) in order to obtain a 100% ownership stake, per a regulatory filing. The acquisition cost consists of Rs 400 crore that must be paid in full at closing, plus an additional Rs 72.50 crore over the following 24 months. The agreement is set up to be debt-free and cash-free.Furthermore, ITC said that it has acquired the remaining 73.5% of Mother Sparsh Baby Care, a digital-first business, of which it first purchased a 26.5% share in 2022.

Since its incorporation in March 2004, SNBPL has developed a portfolio of more than 100 organic products, including branded beverages, sauces, culinary oils, spices, and basics. Additionally, the brand is well-known abroad, especially among Indian diaspora members. Across 71 clusters in 10 Indian states, SNBPL oversees around 1.4 lakh acres of certified organic farming and works with about 27,500 farmers. The company's revenue for FY 2023-2024 was Rs 306.1 crore.

Founder and Managing Director of SNBPL Rajashekar Reddy Seelam was upbeat about the agreement, saying, "ITC shares our vision of promoting healthy lifestyles and sustainable livelihoods for farmers." We think 24 Mantra Organic will be able to reach millions of homes thanks to ITC's expertise in product development and distribution.

It is anticipated that the deal will be finalized either at a mutually agreed upon later date or during the first quarter of the fiscal year 2025-2026. Additionally, SNBPL runs two completely owned subsidiaries: Sresta Global FZE in the United Arab Emirates and Fyve Elements LLC in the United States.