In a strategic move to enhance its direct-to-consumer (D2C) food offerings, ITC Limited has announced the acquisition of the ‘Prasuma’ and ‘Meatigo’ brands. This acquisition aims to bolster ITC a presence in the frozen, chilled, and ready-to-cook food segments, positioning the company as a comprehensive player in these rapidly growing Meatigo markets. The deal includes plans for ITC to secure a 100% stake in Prasuma over the next three years, reflecting the company’s commitment to expanding its footprint in future-facing food categories. This move aligns with ITC’s ‘ITC Next’ strategy, focusing on building a future-ready portfolio that caters to evolving consumer preferences.
Meatigo: Company Overview
Meatigo, operating under the ‘Meatigo by Prasuma’ brand, is a direct-to-consumer platform offering a wide range of meat and meat products. Founded in 2016 by Siddhant Namgyal Wangdi, the company specializes in delivering high-quality, farm-fresh products to consumers’ doorsteps. Its product range includes poultry, pork, bacon, kebabs, mutton, seafood, and sausages, available in both raw and processed forms. Meatigo maintains stringent quality standards by managing its supply chain from procurement to delivery, ensuring freshness and safety. The company operates in over 100 cities across India through online and offline channels, as well as cloud kitchens. Its direct-to-consumer platform promises delivery within 30 minutes in major Indian cities, catering to the growing demand for convenience among consumers.
ITC’s Strategic Acquisition
ITC Limited, a diversified conglomerate with interests spanning FMCG, hotels, paperboards, and more, has been actively expanding its presence in the fast-moving consumer goods (FMCG) sector. The acquisition of Prasuma and its associated brand, Meatigo, is a significant step in this direction. According to a joint statement, ITC plans to acquire a 100% stake in Prasuma over a period of three years. ITC will initially acquire a 43.8% stake for ₹131 crore through primary subscription and secondary purchases, completing the deal by March 2025, subject to closing conditions. Its stake will rise to 62.5% by April 2027 with additional secondary purchases of ₹56 crore at a pre-agreed valuation. The company will acquire the remaining stake by June 2028, following predefined valuation criteria. This phased acquisition strategy allows ITC to integrate Prasuma’s operations seamlessly while leveraging its existing distribution and marketing strengths.
Market Context and Growth Potential
The frozen, chilled, and ready-to-cook food market in India is currently valued at over ₹10,000 crore and is poised for rapid growth in the coming years. Factors such as increasing urbanization, changing consumer lifestyles, and a growing preference for convenience foods are driving this expansion. ITC entered this segment in 2019 with the ‘ITC Master Chef’ brand, offering frozen snacks and meals. The Prasuma and Meatigo acquisition strengthens its portfolio, making ITC a full-stack player across meal occasions. This move leverages ITC’s distribution and branding with Prasuma’s product innovation and manufacturing.
Background of Prasuma and Meatigo
Prasuma, established in 1985, began as India’s first premium delicatessen brand, supplying high-quality cold cuts and meats to leading hotel chains in Delhi. Over the years, the company expanded its distribution nationwide, pioneering the cold cuts category in India. In 2019, Prasuma launched ‘Prasuma Momos,’ a market-first innovation that led the frozen momos category. It later introduced frozen baos, Korean fried chicken, and Japanese fried rice. Meatigo, Prasuma’s D2C platform, offers premium delicatessen and raw meats, ensuring quality control. Prasuma and Meatigo an innovation and consumer engagement expertise complement ITC a strengths, driving growth in frozen and ready-to-cook food.
Learning for Startups and Entrepreneurs
This acquisition offers several insights for startups and entrepreneurs:
- Strategic Partnerships: Aligning with larger corporations can provide access to extensive distribution networks and resources, facilitating accelerated growth.
- Market Positioning: Focusing on niche markets and pioneering product categories can establish a strong brand presence and attract acquisition interest.
- Innovation: Continuous product innovation tailored to consumer preferences is crucial for staying competitive in dynamic markets.
- Scalability: Building scalable operations with a focus on quality and customer satisfaction can make a company an attractive acquisition target.
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