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Balaji Wafers looking for investors

 Balaji Wafers
July 31, 2013
PepsiCo and Mondelez, along with their Indian counterparts ITC and Britannia, have been approached for a stake of Balaji Wafers - a 37-year-old india based wafer (potato chip), namkeen and savoury brand that dominates a number of states in western India including Gujarat, Madhya Pradesh, Rajasthan, Maharashtra and Goa with over 65% market share.

Balaji, run by the Virani family, has recently mandated Ernst &Young (E&Y) to locate an investor.

The company and its advisors are in early-stage talks with several FMCG companies as well as a clutch of consumer-focused private equity funds.

Confirming the development, Balaji Wafers MD Chandu Virani told ET: "An FMCG company with presence in this category will seek that we offload majority stake and continue to run the company for at least next five years. They would meanwhile continue to buy out leftover stakes until they understand the business completely. There could (also) be Private Equity partners who would buy 25% stake."

Even though the promoters are keen to retain a partial stake after selling majority control in the company, most of the potential suitors have made it clear that they would ideally want a 100% stake. Depending on the final valuation, the promoter family too may consider such a proposal, said sources aware of the ongoing discussions.

Companies in this Article
Balaji Wafers is one of the larger potato chips producing companies in India, with a high market share especially in Gujarat.
Frito-Lay North America (FLNA) includes Pepsico's snack operations in the United States and Canada where the company dominates the market with a range of savory snacks brands including Lay's, Ruffles, Doritos, Tostitos, Fritos, Cheetos and Sunchips
ITC Limited is an Indian telecommunications giant and cigarette manufacturer diversifying in the Consumer Packaged Goods market, including the snack foods sector with its brand "Bingo!". Bingo managed to capture an 11% market share of the Indian snack market within 6 months of its launch.