By IANS
New Delhi : The Tata group, India's largest private business group, announced yet another acquisition Friday with the decision to pick 10.74 percent equity in the company that owns the "Himalayan" brand of bottled water.
Tata Tea said it would acquire the shares of Mount Everest Mineral Water Company at Rs.140 per share. This apart, it will also subscribe to a preferential issue of 15 percent and make an additional open public offer of up to 20 percent.
The deal comes within a week of Tata Tea, the world's second-largest branded tea company, announcing its intention to sell its 30 percent equity in the US-based vitamin water maker Glaceau to Coca-Cola for $1.2 billion.
The company's intention is to tap the Rs.11 billion ($265 million) bottled water business in India, which is highly fragmented with over 200 brands but growing at 25 percent annually.
"There is tremendous growth potential in the global market for value-added water and the acquisition of Himalayan will enable us to tap opportunities effectively and build a global presence," said Tata Tea chief Percy Siganporia.
Prior to the deal, Tata Tea had commissioned Hidell-Eyster International, one of the leading water specialists in the US to carry out an extensive technical due-diligence of water source at the foothills of the Himalayas in Himachal Pradesh.
"According to them, this would be one the largest, purest and perennial sources of natural mineral water in the world," Tata Tea said in a statement.
"The company plans to establish Himalayan as the leader in natural mineral water category, while building new brands in the enhanced water space on the platform of health and wellness," the statement said.
The group also wants to straddle all segments of the consumer pyramid with major forays into high-growth global markets.
The bottled water company belonged to Mumbai-based entrepreneur Dadi Balsara and was acquired by a group of investors who currently hold 21.5 percent. While 27.8 percent stake is held by funds, the rest is with the public.