Capital Foods Pvt Ltd, the manufacturer of condiments, food products, and ingredients under the Ching's Secret and Smith & Jones brands, is up for sale for between $1 and $1.25 billion. Competitors include Nestle, Kraft Heinz, Hindustan Unilever, Tata, ITC, Orkla, and Nissin Foods.
Late last year, Capital Food's three major owners made the decision to list the business for sale. They include Ajay Gupta owning 25%, the creator and chairman of Capital Foods, a former advertising executive turned food entrepreneur, and Invus Group, a European family office and investment arm with a 40% stake and U.S private equity group General Atlantic owning 35%.
Before non-binding offers are submitted in early May, several prospective buyers have already met with the management.
The investment bank hired to oversee the auction procedure, Goldman Sachs, is said to have contacted companies like PepsiCo and Reliance Industries. However, given the high valuations, Reliance is reportedly not keen on pursuing the potential bid, according to executives familiar with the events.
Why is Ching's Secret owner Capital Food in popular demand by big companies?
Ajay Gupta established Capital Foods in 1995 with a selection of 'desi' Chinese and Italian foods. Along with the Smith & Jones line of ginger garlic paste, sauces, and baked beans, the selection also included Ching's Secret instant Chinese noodles, soups, condiments, curry pastes, and frozen entrees.
Despite there being about a dozen competitors in the noodles and condiments market, the acquisition would be profitable for any acquirer given the distinct "desi Chinese" positioning.
Ching's Secret is also backed by Bollywood actor Ranveer Singh