<p>Tata Chemicals on Wednesday said it will demerge its consumer products business and merge with Tata Global Beverages Ltd (TGBL).</p>.<p>The Boards of Directors of Tata Global Beverages Limited (TGBL) and Tata Chemicals Limited (TCL), at their respective meetings held on Wednesday, have approved the de-merger of the Consumer Products Business of TCL into TGBL through a National Company Law Tribunal (NCLT) approved scheme of arrangement.</p>.<p>The boards have also approved formation of a new entity called Tata Consumer Products Limited, the companies said in a statement.</p>.<p>Subsequently, each shareholder of TCL will get 1.14 new equity shares of TGBL for every 1 equity share held in TCL i.e. a shareholder holding 100 shares in TCL will receive 114 shares in TGBL. The respective Boards have approved the Entitlement Ratio based on the recommendations of independent valuers.</p>.<p>The proposed transaction will create a focused Consumer Products Company with a combined turnover and EBITDA of Rs 9,099 crore and Rs 1,154 crore respectively, for the twelve months period ended March 31, 2019 on a proforma basis.</p>.<p>The combination of the two consumer-focused businesses will benefit both sets of shareholders who will be able to participate in a larger business poised to grow their share of the foods & beverages market with a broader exposure to the attractive and fast-growing FMCG sector. TCL shareholders will retain their ownership of a focused science-led chemistry solutions and specialty products company with a leading portfolio of products in basic and specialty chemicals and strong cash flows to support future growth, the statement said.</p>.<p>The combined consumer business will also benefit from a combined reach of over 200 million households, a broader portfolio to deepen distribution, enhanced innovation capabilities, as well as a strong product pipeline. In addition, the new consumer entity expects to achieve substantial revenue and cost synergies which will add value to its shareholders. </p>.<p>The transaction is subject to the necessary statutory and regulatory approvals including approvals of the respective benches of NCLT, the Stock Exchanges, SEBI and the respective shareholders and lenders/creditors of each of the companies. The transaction is expected to be completed by Q4 FY20 / Q1 FY21.</p>.<p>Commenting on the announcement, N Chandrasekaran, Chairman, Tata Sons said, “Tata Consumer Products consolidates our current presence in food & beverages in the fast-growing consumer sector. Through this combination, we have created a strong growth platform to meet the growing aspirations of Indian consumers.”</p>.<p>Ajoy Misra, Managing Director & CEO of TGBL, added: “This transaction is consistent with our strategy to deepen our India presence and transform into a broader FMCG player. Existing TGBL shareholders will benefit significantly as the Consumer Products Business increases our exposure to high growth product categories and provides a strong platform to seize new opportunities in this sector. We will also continue to nurture and grow our global brands.”</p>
<p>Tata Chemicals on Wednesday said it will demerge its consumer products business and merge with Tata Global Beverages Ltd (TGBL).</p>.<p>The Boards of Directors of Tata Global Beverages Limited (TGBL) and Tata Chemicals Limited (TCL), at their respective meetings held on Wednesday, have approved the de-merger of the Consumer Products Business of TCL into TGBL through a National Company Law Tribunal (NCLT) approved scheme of arrangement.</p>.<p>The boards have also approved formation of a new entity called Tata Consumer Products Limited, the companies said in a statement.</p>.<p>Subsequently, each shareholder of TCL will get 1.14 new equity shares of TGBL for every 1 equity share held in TCL i.e. a shareholder holding 100 shares in TCL will receive 114 shares in TGBL. The respective Boards have approved the Entitlement Ratio based on the recommendations of independent valuers.</p>.<p>The proposed transaction will create a focused Consumer Products Company with a combined turnover and EBITDA of Rs 9,099 crore and Rs 1,154 crore respectively, for the twelve months period ended March 31, 2019 on a proforma basis.</p>.<p>The combination of the two consumer-focused businesses will benefit both sets of shareholders who will be able to participate in a larger business poised to grow their share of the foods & beverages market with a broader exposure to the attractive and fast-growing FMCG sector. TCL shareholders will retain their ownership of a focused science-led chemistry solutions and specialty products company with a leading portfolio of products in basic and specialty chemicals and strong cash flows to support future growth, the statement said.</p>.<p>The combined consumer business will also benefit from a combined reach of over 200 million households, a broader portfolio to deepen distribution, enhanced innovation capabilities, as well as a strong product pipeline. In addition, the new consumer entity expects to achieve substantial revenue and cost synergies which will add value to its shareholders. </p>.<p>The transaction is subject to the necessary statutory and regulatory approvals including approvals of the respective benches of NCLT, the Stock Exchanges, SEBI and the respective shareholders and lenders/creditors of each of the companies. The transaction is expected to be completed by Q4 FY20 / Q1 FY21.</p>.<p>Commenting on the announcement, N Chandrasekaran, Chairman, Tata Sons said, “Tata Consumer Products consolidates our current presence in food & beverages in the fast-growing consumer sector. Through this combination, we have created a strong growth platform to meet the growing aspirations of Indian consumers.”</p>.<p>Ajoy Misra, Managing Director & CEO of TGBL, added: “This transaction is consistent with our strategy to deepen our India presence and transform into a broader FMCG player. Existing TGBL shareholders will benefit significantly as the Consumer Products Business increases our exposure to high growth product categories and provides a strong platform to seize new opportunities in this sector. We will also continue to nurture and grow our global brands.”</p>
