Chennai-based Capricorn Food Products India Ltd, an integrated food processing company, has raised private equity investment of $10 million (Rs 60 crore) from Quadria India (earlier, Milestone Religare Investment Advisors) for a minority stake in the company.
The company plans to use the funds to expand its manufacturing facilities, add new product lines and undertake new initiatives. Consort Capital was the financial advisor for the transaction.
VCCircle was the first to report this development in February this year.
Rahoul Jain, managing director, Capricorn, said, "The Quadria team has an understanding of the sector and markets where we wish to increase our presence.”
Capricorn produces fruit and vegetable pulps/purees, concentrates and IQF fruits and vegetables. The company, founded in 1998, established its first pulp canning and processing plant in Andhra Pradesh. The firm, which also supplies products to FMCG brands in India, exports its offerings to customers in the Middle East, the US and Europe. It has four facilities in Andhra Pradesh, Tamil Nadu and Maharashtra.
Quadria India has already made six investments out of its Rs 434 crore India Build-Out Fund-I. The fund is currently fully deployed across investments into companies in healthcare, education, credit research as well as food and agri industries.
This is not the first investment in this area by a PE firm. Last year, GEM India Advisors (GIA) and former Goldman Sachs' partner Hank Uberoi's fund Haystack put in Rs 14 crore in Bakers Circle (India) Pvt Ltd, a maker of frozen bakery and confectionery products. Bakers Circle had raised Rs 11.5 crore in its earlier rounds.
In March this year, Quadria Capital Investment Advisors acquired Milestone Religare Investment Advisors Pvt Ltd (Milestone Religare), an equal joint venture between Milestone Capital and Religare. Milestone Capital had been looking for buyers after its founder Ved Prakash Arya died in a freak accident in August 2011.
The Indian food processing industry accounts for 32 % of India's total food market. The industry is set to grow to $200 billion by 2015, growing at a CAGR of 15%. It is among the largest industries in India and is ranked fifth in terms of production, consumption and exports.
The government’s decision to allow 51 per cent foreign direct investment (FDI) in multi-brand and 100 per cent in single-brand retail is expected to bring in more opportunities for domestic processed food makers.
(Edited by Joby Puthuparampil Johnson)