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Tata Group, India's largest conglomerate, is evaluating a proposal to integrate its agribusiness activities into a single company, said people with knowledge in the material.
The Mumbai-based group plans to separate the salt and lentil businesses from Tata Chemicals Ltd. and to bend them in Tata Global Beverages Ltd., according to people who asked not to be named because the information is private. There is also talk of merging Tata Coffee Ltd., which owns coffee plantations and tea plantations, with the company's beverages, and enter dairy products, they said.
The proposal is part of President Natarajan Chandrasekaran's broader strategy of consolidating related activities under one roof to increase efficiency and simplify the conglomerate, which includes more than 100 independent operating companies. In April, the Tata group announced that it would create a single entity called Tata Aerospace & Defense by merging all the allied companies.
Tata Global Beverages, one of the largest branded tea sellers in the world, could be renamed to reflect the broader focus on the food business, people said. The company sells tea under brands such as Tetley and Tata Tea, coffee under eight hours and bottled water under Himalaya.
The shares of Tata Global Beverages rose to 7.4%, their highest increase since August 16th, at 14:41. in Mumbai. Tata Coffee has jumped up to 18 percent, the most in nearly six years. Tata Chemicals rose 3.8%. The benchmark S & P BSE Senbad rose 0.4%.
Different Options
Another alternative considered is the consolidation of companies under Tata Chemicals, said two people. The world's second largest producer of soda ash, the company also sells salt under the Tata brand and introduces brand-name pulses, including black pea and pigeon pea, in 2010.
The group is weighing different options and a final decision has not been made about which units will be merged and in which company, people said. A special task force was formed and made presentations to the board of directors of Tata Sons Ltd., the group's holding company, they said.
Representatives of Tata Group and Tata Global Beverages declined to comment on speculation in the market. Tata Chemicals also declined to comment, while Tata Coffee did not immediately respond to a request for comment.
The merged entity will also seek to set up an integrated dairy business either through acquisitions or by building it from scratch by leveraging the companies' cold shipping capabilities. of the group, added the people.
There are also deliberations that are at an early stage on grouping the various consumer and retail businesses of the group under one roof, people said. There is no timetable for a decision or the certainty that it will result in consolidation, they said. The group has companies including Infiniti Retail, an operator of consumer electronics stores, Landmark, which runs a network of outlets for books and music, and Titan Co., which sells watches and jewelry to through its chain of stores.
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