Peepul Capital buys out Lighthouse Funds stake in Unibic India

Mumbai: Mid-market private equity investor Peepul Capital has acquired the stake of Lighthouse Funds in biscuit maker Unibic Biscuits India Pvt. Ltd.

Unibic India was incorporated in July 2004, with an initial investment of Rs15 crore as the Indian subsidiary of Australian cookie maker Unibic. In 2007, Lighthouse bought 25% stake in the company for close to Rs20 crore. In 2012, Peepul Capital acquired a majority stake in the company for close to Rs100 crore.

“We have consolidated our position. We are the only institutional investor in the company right now,” Srini Vudayagiri, investment director at Peepul Capital, said in an interview.

He, however, declined to share financial details of the transaction, citing confidentiality norms. The company’s non-institutional shareholders include former industry veteran and Unibics India managing director Nikhil Sen.

Unibic India, which has a factory in Bengaluru, specializes in premium cookies including specialty Australian and European cookies, centre-filled products and niche products such as health snacks. It also exports to Australia, Dubai and China. In India, the company also sells products under private labels like ‘Tasty Treats’ for Food Bazaar and cookies for Cafe Coffee Day.

In the last financial year, the company clocked revenues of close to Rs200 crore.

According to market research firm ValueNotes, the biscuits and cookies industry in India was valued at $2.41 billion in FY2014 and growing at a compounded annual growth rate (CAGR) of 10% over the last three years.

According to ValueNotes, the industry is expected to touch revenues of $4.65 billion by FY 2019.

The share of premium biscuits is likely to increase as manufacturers enter the segment which offers higher margins.

In India, the biscuits and cookies market is currently dominated by Britannia Industries, Parle Products and Mondelez International.

Peepul Capital currently has investments worth $700 million under management. Founded in 2000, it has invested in more than 27 companies across sectors. It typically makes investments in the range of $15-25 million. Last year, it led a funding round of $16 million in Bengaluru-based Founding Years Learning Solutions, which runs Klay Schools preparatory schools and daycare centres.

Lighthouse Funds currently has a corpus of approximately $235 million. The PE fund has raised two India-focussed funds $100 million and $135 million respectively and has invested in 16 companies so far. It typically invests $5-20 million per transaction.