Avendus fund buys into Bikaji Foods as Lighthouse makes another partial exit
Photo Credit: VCCircle

Mid-market private equity firm Lighthouse Funds has struck a second partial exit from Bikaji Foods International Ltd, a year after first paring its stake in the snacks maker.

The Mumbai-based PE firm has sold a part of its stake to a new fund launched by financial services firm Avendus Capital in a secondary transaction, as per a press statement.

Intensive Softshare, another investor in the firm, also sold a part of its stake to the Avendus Future Leaders Fund.

The financial details of the deal couldn’t be immediately ascertained.

Deepak Agarwal, director at Bikaji Foods, said the investment will help the Avendus fund tap into the huge potential offered by the Indian packaged food industry.

The Future Leaders Fund, a SEBI-registered category II alternative investment fund (AIF), is planning to raise Rs 500 crore from individual and institutional investors. The fund seeks to invest in eight to 10 companies with an average investment size of Rs 40-75 crore.

Lighthouse had picked up a 12.5% stake in the snacks maker for Rs 90 crore in April 2014. It partially exited Bikaji in May 2018. It sold a 2.5-3% stake during that transaction to IIFL Special Opportunities Fund and pocketed Rs 100 crore. After the transaction, it held a stake of around 10% in the firm.

Bikaji Foods

Promoted by Shiv Ratan Agarwal, the snacks maker was earlier called Shivdeep Industries Ltd. It was established in 1986 as a partnership concern before being converted into a limited company in 1995.

The company used to sell its products under the Haldiram’s brand until 1993, when it parted ways with the Nagpur-headquartered Haldiram Foods International Pvt. Ltd and took the Bikaji brand name.

Bikaji makes Indian snacks such as bhujia, papad, namkeensand sweets including rasgulla at its factory in Bikaner. The company operates in a fragmented and unorganised food industry, where it faces competition from local manufacturers as well as organised players.

Apart from its home turf of Rajasthan, the company has a strong presence is a few other states such as Bihar and Assam.

Last year, the company was looking to float an initial public offering of about Rs 600-700 crore to help fund its expansion plans.

According to VCCEdge, the data research arm of Mosaic Digital, Bikaji posted net sales of Rs 783.2 crore for the year ended in March 2018 as compared with Rs 608.7 the year before. Its net profit rose to Rs 53 crore from Rs 43.7 crore.

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