July 4, 2018
India’s biggest conglomerate- The Tata Group wants to integrate its food and beverage businesses into a single company. It is considering separating the salt and branded lentils businesses of Tata Chemicals Ltd. and folding them into Tata Global Beverages Ltd.. The company is also looking into merging Tata Coffee Ltd., which owns coffee plantations and tea gardens, with the Beverages Company, and entering dairy.
Natarajan Chandrasekaran, Chairman of Tata group is actually strategising to combine related businesses under a single umbrella to increase efficiency and simplify the conglomerate, which includes more than 100 independent operating companies.
Tata Global Beverages, one of the biggest branded tea sellers in the world, could be renamed to reflect the broader focus on the foods business. The company sells tea under brands including Tetley and Tata Tea, coffee under Eight O’clock and bottled water under Himalayan.
Another alternative being considered is consolidating the businesses under Tata Chemicals, two of the people said. The second-largest producer of soda ash in the world, the company also sells salt under the Tata brand name and introduced branded pulses, including black gram and pigeon peas, in 2010.
The group is weighing different options and a final decision hasn’t been made about the units that will be merged and into which company, the people said. A special task force has been formed and has made presentations to the board of Tata Sons Ltd., the group’s holding company, they said.
The merged entity will also look to set up an integrated dairy business either through acquisitions or by building it from scratch by leveraging the refrigerated shipping capabilities of group companies.