HLL Board Grants In Principle Approval For Transfer Of It's Domestic Edible Oils And Fats Business To Bunge

The Edible Oils and Fats business of HLL comprises manufacture and marketing of Vanaspati (Hydrogenated Fats), Refined Oils and Bakery Fats. The proposed transfer of business to Bunge which is structured as a slump sale/ going concern would include the manufacturing facility at Trichy, Tamil Nadu, together with approximately 300 employees directly relevant to the business with continuity of service and full protection to existing terms and conditions. It will also involve assignment of well known brands like Dalda and its various extensions, Masterline, Gold Seal, Silver Seal, Marvo, Biskin and Lily in India and Nepal. HLL would continue to distribute the products of the business post divestment through a distribution arrangement with Bunge for a fee. The dealings with stockists and trade will therefore remain unaffected by the proposed transaction.

HLL would very soon seek the approval of its shareholders through a postal ballot for the divestment of its Edible Oils and Fats Business and the definitive agreements are expected to be signed in July/ August 2003 after receipt of various approvals by HLL and Bunge.

The divestment of the business is in line with HLL’s focussed business strategy and rationalisation of its existing brand portfolio. Value added processed foods will continue to remain a key focus area for HLL growth and it will seek to build and grow its portfolio of products and categories in this market with power brands such as Knorr, Kissan, Annapurna, Becel, etc.

Bunge Limited is a US-based integrated, global agribusiness and food company operating in the farm-to-consumer food chain with worldwide distribution capabilities with approximate turnover of US $ 14 Billion. Founded in 1818 and headquartered in White Plains, New York, Bunge has over 25,000 employees and locations in 29 countries. Bunge is the world’s leading oilseed processing company, the largest producer and supplier of fertilizers to farmers in South America and the world’s leading seller of bottled vegetable oils to consumers. The Group has substantial presence in Latin America, particularly Brazil and Argentina. The Group is professionally managed and shares the values and work ethos similar to that of HLL.

HSBC Securities and Capital Markets (India) Private Limited advised HLL on the divestment of its Edible Oils and Fats Business