MOPE invests $15m in India's Ganesh Grains
Motilal Oswal Private Equity (MOPE) has invested INR1 billion ($15 million) in Indian packaged cereals producer Ganesh Grains.
The company will use the capital to increase brand awareness, expand its distribution network and build out its production capacity. Ganesh, which currently only sells in its home state of West Bengal and neighboring Jharkand, hopes to become a major presence in northeast India.
This is the first private equity investment for Ganesh, which was founded in 1936 in Kolkata. For most of its history the company has focused on its flour milling operation, adding a packaged grain products business 10 years ago. Now Ganesh manufactures around 100 separate products, including wheat and chickpea flour, semolina and porridge mix.
The Mimani family, which controls Ganesh, also hopes to gain a mentor in MOPE that can help them streamline and professionalize the business to take advantage of its growth opportunities. Food grain consumption is estimated to account for INR700 billion of Indian consumer spending annually, but the industry is largely dependent on local family-run businesses, with no significant market leaders.
"The food staples industry is undergoing a fundamental transformation. The combined effects of demographic shifts & rise of new consumption centers, will have a profound impact on the shape of demand over the next few decades," MOPE CEO Vishal Tulsyan told The Economic Times. "Through this partnership with Ganesh Grains, we intend to help create a large, differentiated leader in India's food staple industry."
MOPE's investment came from its second growth capital vehicle, India Business Excellence Fund II, which closed in 2013 at $155 million. The fund seeks minority stakes in Indian small and medium-sized enterprises across a range of sectors. Investments this year include frozen dessert maker Dairy Classic Ice Creams and online energy trading platform India Energy Exchange.
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