Bombay Dyeing Likely To Acquire Danone

Mumbai: The Wadias of Bombay Dyeing are prepared to purchase the entire stake of partner Groupe Danone in biscuit maker Britannia at a discount. The contours of the deal are likely to be drawn up at a meeting on September 3. That is also the time when Danone Chairman Franck Riboud is hoped to be in India. French dairy foods giant''s exit will be in line with that of other multinational companies from joint ventures in India and the discount in this case could be as much as 20 per cent to the market price.

Danone is keen on operating on its own in India and needs a no-objection from the Wadias to be able to do so. The Wadias and Danone hold 50 per cent equity each in Associated Biscuits International (ABIL), which holds 51 per cent equity in Britannia, giving each partner control over 25.1 per cent equity of the joint venture. The two partners started bickering last year over control of the Tiger brand, which Danone had reportedly taken to other countries without taking the Wadias into confidence. At the September 3 meeting, the two partners are also likely to discuss the thorny issues of intellectual property, Groupe Danone''s acquisition of a stake in Bangalore-based nutritional foods company Avesthagen and the no-objection certificate that Danone needs to go solo.

Source : www.indian-commodity.com