SIL Investments Limited, a prominent investment firm, has announced its decision to acquire a 3.10% stake in Morton Foods Limited for Rs. 2.42 crore. This move is part of SIL Investments' strategy to strengthen its foothold in the Fast-Moving Consumer Goods (FMCG) sector, a dynamic and rapidly growing industry in India. With this acquisition, SIL Investments' cumulative holding in Morton Foods will increase to 6.71%.

About Morton Foods Limited

Morton Foods Limited (MFL) is a well-known name in the FMCG industry, offering a diverse range of products, including jams, ketchup, juices, canned fruits & vegetables, and ready-to-eat meals. The company was incorporated on March 19, 2015, and has since expanded its market reach across India.

Financial Performance of Morton Foods

Over the last three years, Morton Foods has experienced a fluctuating financial trajectory:

• 2021-22: Rs. 50.79 crore turnover

• 2022-23: Rs. 45.28 crore turnover

• 2023-24: Rs. 35 crore turnover

The declining turnover suggests market challenges, but SIL Investments' decision to acquire additional shares reflects its confidence in Morton Foods' future growth prospects.

Nature of the Transaction

Since Morton Foods' promoters are also promoters of SIL Investments, this qualifies as a Related Party Transaction. The acquisition will, however, be conducted at arm’s length, ensuring transparency and regulatory compliance.

Strategic Impact of the Acquisition

SIL Investments' acquisition of a stake in Morton Foods is an investment in the ordinary course of business. Notably, SIL Investments does not intend to take over the management of Morton Foods, nor does it seek direct or indirect control over its operations.

Transaction Details

• Equity Share Capital of Morton Foods (as of March 31, 2024): Rs. 21.10 crore

• Total cost of acquisition: Rs. 2,42,07,625

• Percentage of shares acquired: 3.10%

• Cumulative holding post-acquisition: 6.71%

• Form of payment: Cash consideration

• Completion timeline: On or before March 31, 2025

Regulatory Approvals

The acquisition does not require any governmental or regulatory approvals, simplifying the transaction process and ensuring a seamless investment.

Conclusion

SIL Investments Limited’s decision to acquire a stake in Morton Foods Limited aligns with its strategic investment approach within the FMCG sector. Despite Morton Foods' declining turnover in recent years, its strong product portfolio and established presence in India make it an attractive investment opportunity. This transaction, expected to be completed by March 2025, will further solidify SIL Investments' position in the FMCG market.

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