Nestlé signs India venture with pharma group Dr Reddy’s

By: Trademagazin editor Date: 2024. 05. 08. 09:39

The Swiss giant’s Indian arm will initially hold a minority stake in the new business.

Nestlé Quality Assurance Centre in Moga, India photo: Nestlé / flickr

Nestlé’s Indian arm has entered into a venture with pharma group Dr Reddy’s Laboratories to make and sell medical-nutrition products and supplements.

The publicly-listed Nestlé India will initially hold 49% of the venture, with the Hyderabad-based Dr Reddy’s owning the rest.

Under the terms of their agreement, Nestlé India has a call option to increase its shareholding up to 60% after six years “at a fair market value”, a stock-exchange filing read.

The companies plan to work together in India and “other agreed territories”, the stock-exchange announcement added.

Nestlé India and Dr Reddy’s plan to target categories the statement listed as “metabolic, hospitals nutrition, healthy ageing, general wellness, women’s health and child nutrition”.

The soon-to-be partners expect to get the venture up and running in the second quarter of Nestlé India’s 2024/2025 financial year, which started on 1 April.

Nestlé India published news of the deal alongside the publication of a set of financial results covering the 15 months to the end of March.

During the period, the company – in which Nestlé owns a majority stake – generated sales of Rs242.76bn ($2.91bn), contributing to a net profit of Rs39.33bn.

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