France’s Danone may exit Britannia

France’s Danone may exit Britannia
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First Published: Thu, Jun 21 2007. 06 46 PM IST
Updated: Thu, Jun 21 2007. 06 46 PM IST
Mumbai: French foods group Danone may exit from a venture with Wadia family that controls biscuit maker Britannia Industries, a leading financial daily said on 21 June, sending the firm’s shares up by as much as 10.7%.
Danone and the Wadias are equal partners in Associated Biscuits International Holding, which controls India’s largest biscuit maker, Britannia.
“Our priority is to develop a fresh dairy and beverage business in India,” the newspaper quoted Groupe Danone Secretary General Philippe Loic Jacob as saying.
Relations between the two partners soured last year when the Wadia group took Danone to court in Mumbai over the French firm’s strategic stake in biotech firm Avesthagen, which the Wadias said violated a non-compete clause in their joint venture agreement.
Responding to the report, Britannia spokeswoman said: “This is an issue between shareholders and even if it were to happen, in no way influences the business or the priorities of Britannia.”
She said the company would continue to grow at an annual rate of 25%, supported by its indigenously developed brands.
By 0758 GMT, Britannia’s shares were up nearly 5% at Rs1,543, after rising as high as Rs1,630, in a firm Mumbai market that rose by 0.5%.
The newspaper said Danone, which is keen on independent Indian operations, was getting “impatient” and was willing to compensate the Wadias for termination of the joint venture.
“We are willing to take radical steps to pursue our own plans,” the paper quoted another Danone official, who requested anonymity, as saying, provided the French firm was given a free hand to pursue its dairy and beverage plans.
The value of Danone’s holding is more than Rs10 billion ($245 million), but the company has not discussed the pricing so far, said the newspaper, quoting unnamed Danone sources. ($1 = Rs40.8)
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First Published: Thu, Jun 21 2007. 06 46 PM IST