ITC To Acquire Over 40% Stake In Frozen Food Brand Prasuma, Plans Full Takeover In Three Years

ITC Ltd. has signed agreements to acquire ready-to-cook and frozen food brand Prasuma, fortifying its presence in the future-facing categories, which the company said has an annual market size of over Rs 10,000 crore.

The Kolkata-based conglomerate will acquire 100% stake in Prasuma over a period of three years, it said in a statement on Thursday. The first tranche of 43.8% stake will be acquired upfront with an initial investment of Rs 131 crore. This transaction is expected to be completed by March 2025.

The company will then raise its stake to 62.5% by April 2027 through secondary purchases worth Rs 56 crore, based on a pre-agreed pre-money valuation. The balance stake will be acquired by June 2028.

Prasuma, with a presence in over 100 cities across online and offline channels, has scaled up to an annual revenue run rate of about Rs 200 crore (on a trailing three-month basis). Its consolidated turnover stood at Rs 131 crore in FY24, up from Rs 111 crore in FY23 and Rs 91 crore in FY22.

Founded in 1985 by Mahendra Suwal, Prasuma specialises in products like momos, baos, Korean fried chicken, delicatessens and raw meats, offering over 170 products. Its flagship product Prasuma Momos, launched in 2019, was the brainchild of his daughter and CEO, Lisa Suwal.

The family-run company also operates Meatigo, a direct-to-consumer platform that offers delicatessens and raw meats; and Prasuma Momo Kitchen which offers pan-Asian offerings through 40 cloud kitchens.

Under the agreement, Prasuma's current leadership team, including Suwal and her husband, Siddhant Wangdi, who is the Chief Operating Officer will continue to manage the company's operations for the next three years. ITC will also have representation on Prasuma's board following the acquisition.

With this strategic buyout, ITC is set to become the first full-stack frozen foods brand. "We believe that the combined portfolio will delight our discerning consumers," said Hemant Malik, whole-time director of ITC Ltd.

ITC entered the frozen foods market in 2019 under the ‘ITC Master Chef' brand, which is available across 200 towns. “With the industry at an inflection point, this acquisition will help strengthen and expand ITC's presence in the aforesaid categories by gaining entry into high growth segments, viz. pan asian foods, deli meats, etc.," the company said.