Nusli Wadia-managed Britannia Industries has signalled its interest in food retailing. The Rs 1,800-crore biscuit major is acquiring Cafe Coffee Day's 50% stake in Daily Bread, a Bangalore-based high-end food retailer.
The financial details of the transaction were not available immediately. "We have acquired a part of Coffee Day's holding in Daily Bread. The company feels the acquisition will give us a foothold in a growing category of 'out-of-home consumption,' involving a discerning, high-end consumer base," Vinita Bali, MD, Britannia Industries, told ET in an interview.
Daily Bread was floated as an equal joint venture between Cafe Coffee Day and a Hong Kong-based investment banker Arjun Sekri, and currently operates own and franchisee outlets in Bangalore, besides presence in modern trade.
Britannia is expected to work on developing a national footprint for Daily Bread, which deals in premium breads, cakes, gelatos, chocolates and other snack foods. "Daily Bread will not sit on top of Britannia's business, but will be complimentary to it.
The acquisition opens up a new channel for us to reach consumers. Britannia, traditionally, has been involved with mass marketed high-velocity products," Ms Bali added. Naresh Malhotra, director, Cafe Coffee Day, said "the company was exiting Daily Bread as it was not core to our business. We were selling a lot of outside food in these outlets. We did not want to be setting up more cake shops. We will continue to source from them for our business."
While CCD is looking to offload its entire 50%, Mr Sekri is expected to retain his stake. Ms Bali, a former Coca-Cola global honcho, said Britannia will continue evincing interest in acquisitions. It was playing in a more competitive biscuit market.
"But we have stabilised our market share from the first quarter of FY06 onwards, and the marketplace has only become more competitive since then. We have 32% share by volume and about 39% by value, which is the highest in the country," she added.
The new MD who stepped into the company at a difficult time has emphasised on "de-layering" Britannia to unlock innovation. "Britannia is operating in a category where not much product or brand development has taken place. We are looking at increasing consumption," she added. Thus, it has pushed Chhota Tiger and Marie Gold Doubles in an otherwise plain Marie segment.