About 40% of a food procurement venture between EL Rothschild and Bharti Enterprises, was offloaded to US-based Del Monte Pacific Ltd. The venture, called FieldFresh Foods Pvt. Ltd, was equally held by Rothschild and Bharti, and the Indian firm will continue to hold on to its 50% share.
Del Monte will pay $20.8 million for the stake, according to a news report by AFX Asia. However, this could not be confirmed by Bharti, which issued a statement which said they will “induct” Del Monte as a “strategic partner” in FieldFresh.
FieldFresh will move from being just a procurer of fresh foods to a processor and under the terms of the deal, Del Monte’s existing food processing facilities in India will be acquired by FieldFresh.
Del Monte currently sells mango pulp and puree out of India. Bharti Enterprises could not clarify the terms of the transaction.
It’s also not clear why Rothschild is getting rid of most of its holdings in FieldFresh, but a statement from Bharti last month said due to “significant logistical challenges in India, both partners are discussing possibilities to scale up the operations of FieldFresh, and are evaluating value-addition opportunities... for this purpose, both partners are seeking alliances with international strategic players”.
Del Monte is one of the biggest producers and marketers of branded foods in the US and has an annual sales of more than $3 billion.
In 2004, Bharti and Rothschild formed the joint venture aimed at exporting fresh produce to Europe, West Asia and Southeast Asia. The two companies invested $50 million and were producing vegetables and fruits through contract farming in Punjab and Haryana. Bharti, along with the world’s top retailer Wal-Mart Stores Inc., has entered into a partnership to open stores for wholesale goods and get logistics and technical assistance for Bharti’s stand-alone retail stores.