FMCG giant Hindustan Unilever Ltd (HUL) has claimed that it is acquiring ‘Adityaa Milk’ ice cream brand from Karnataka-based Vijaykant Dairy and Food Products Ltd. The financial details of the deal have however not been disclosed yet.
With this, HUL is planning to take over a larger part of the fragmented ice cream market in India. HUL has signed a contract with Vijaykant Dairy to buy out ice cream and frozen dessert business of the company and also with its front-end distribution across Karnataka, Maharashtra, Goa and Kerala where Adityaa Milk is currently present.
“Ice Creams and Frozen Desserts is an exciting category and we see great potential for growth. We believe the acquisition will complement our existing portfolio of Kwality Wall’s,” said HUL chairman Sanjiv Mehta.
At present, HUL already sells ice creams under the brands including Kwality Wall’s, Magnum and Cornetto. Adityaa Milk was founded in 2004 by Vijaykant Dairy in Karnataka. Later, he spread its wings across Maharashtra, Goa and Kerala. He stated that he will continue to pursue dairy business after the acquisition is implemented.
HUL also stated that Vijaykant Dairy will manage the business till the transaction is finished, and also continue to manufacture for HUL for an agreed duration.
“HUL is already a strong number two player in ice cream and this acquisition will help in closing the gap with Amul. HUL will bring its distribution muscle and analytics capability to Adityaa,” said Abneesh Roy, an analyst with Edelweiss Securities.
Prior to this acquisition, HUL has also made an acquisition in other ice cream companies as well. It acquired Kwality Wall’s in phases starting 1994 when it bought the trademark. Apart from Amul, various other home-grown brands such as Mother Dairy, Vadilal, Kwality Wall’s and Havmor have prominent existence.