Tilaknagar Industries Buys IMFL Business Of IFB Agro

Leading Indian-made-foreign-liquor (IMFL) manufacturer Tilaknagar Industries (TI) company has acquired the complete IMFL business of the Kolkata based IFB Agro. The Boards of both the companies have approved the acquisition paving the way for transfer of all the IMFL brands from IFB Agro's portfolio into that of TI and the agreements have been executed. With this, TI has brought into its fold IFB Agro's vodka brand 'Volga' and 'Blue Lagoon' gin - two of the most popular brands of the latter in eastern Indian markets of West Bengal, Assam and Odisha.  However, the acquisition cost is not disclosed by the company.

Commenting upon the development, Laxmi Narasimhan K, Deputy Managing Director of TI said, "This is an EBDITA accretive acquisition for us. We are focused more on profitable volumes and the acquisition of IFB Agro's IMFL business will give us access to a profitable product line. Coming up as a dominant IMFL player of South Indian market, we will now consolidate our position in eastern Indian market too. We hope to enhance sales of the newly acquired brands to one million cases per annum and improve our topline sales by over 10 per cent".

This is a step taken by the company, to consolidate its position in the IMFL business. The company has already made a strong base in the southern region of the country viz. Kerala, Tamil Nadu, Karnataka and Andhra Pradesh.

This is not the first time that TI has gone ahead in acquiring portfolios of businesses of its competitors. In 2010, it acquired prominent brands/trademarks of Punjab based Alcobrew Distilleries India that allowed the Company to add brands such as White House whisky, White House brandy, Golden Chariot whisky, Bachelor Deluxe whisky and Bonking rum to its portfolio.

We believe that this move by the company will be an value accretive one as this will consolidate its position in the eastern part of the country. In today's trade the company closed at Rs 56.45 (+2.54%) on BSE. Owing to this post market development buying activity in the counter in tomorrow's session cannot be ruled out.