Bunge to buy edible oils business of Amrit Banaspati

Bunge India, the subsidiary of American agribusiness company Bunge, has entered into an agreement to acquire the edible oils and fats business of India-based Amrit Banaspati for Rs2.21bn ($40.87m), as a part of the its strategy to grow its consumer foods business in India.

The acquisition includes Amrit Banaspati's manufacturing plant in the state of Punjab, which features equipment and facilities for refining crude edible oils, palm oil fractionation, hydrogenation, margarine production and packaging.

It includes the rights to Amrit Banaspati's brands, including Amrit, Bansari, Ginni, Merrigold and Sunehri Teer, among others, as well as its sales and distribution division and the transfer of employees pertaining to its edible oils and fats business.

Bunge will also pay Rs1.04bn ($19.23m) to acquire rights to Gagan - the vanaspati brand owned by Amrit Corporation, the flagship company of the Amrit Group.

In addition, the company will pay Rs470m ($8.69m) as a non-competent fee to key promoters Naresh Kumar Bajaj, Ashwin Kumar Bajaj and Vikram Kumar Bajaj.

The transaction is subject to regulatory clearances and other customary closing conditions.

Bunge India managing director Adhiraj Sarin said that Amrit, Gagan and Ginni are trusted names associated with preparing tasty food, and the company intends to build on their strong brand heritage.

"These brands, coupled with capable employees and a strong distribution network, open up opportunities for synergistic collaboration with Bunge India, creating incremental value for the combined operations," Sarin added.