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Tata Consumer to buy out PepsiCo from beverage joint venture

By Debjyoti Roy

  • 18 May 2020
Tata Consumer to buy out PepsiCo from beverage joint venture
Credit: Reuters

Tata Consumer Products Ltd said on Monday it will acquire PepsiCo’s stake in NourishCo Beverages Ltd, an equal joint venture between the two companies, for Rs 29 crore ($3.8 million).

The decision to buy PepsiCo’s 50% stake in NourishCo is consistent with Tata Consumer’s focus on widening its portfolio in the food and beverages segment, the Indian company said in a statement.

"The liquid beverages category has exciting growth potential and this move will help us strengthen and widen our presence in it,” Sunil D’Souza, CEO at Tata Consumer, said.

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Tata Consumer, in its previous avatar as Tata Tea Ltd, and PepsiCo had formed the joint venture in 2010. NourishCo sells non-carbonated beverages Himalayan mineral water, Tata Gluco Plus and Tata Water Plus.

Tata Consumer is said to have a consolidated revenue of Rs 10,000 crore and employs over 2,200 people in its branded business.  

India's steel-to-autos conglomerate Tata Group had also last year demerged the consumer products business of Tata Chemicals into Tata Global Beverages to achieve broader exposure to the fast-moving consumer goods sector.

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The demerged entity houses currently key brands such as Tata Salt, Tata Tea, Tata Sampann and Tetley under a single umbrella. Tata Chemicals, on the other hand, will focus on innovative science-based chemistry solutions and products.

Tata Consumer claims to be the second-largest player in branded tea in the world with over 330 million servings everyday across the globe. The company also has a joint venture with Starbucks called Tata Starbucks Ltd, to own and operate Starbucks cafés in India. 

Since the inauguration of the flagship store in Mumbai in October 2012, this 50:50 JV has expanded to 10 cities, with many more Starbucks stores planned across the country.

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