MADRID, SPAIN — Ebro Foods has reached an agreement to acquire Taraori Rice Mills Private Ltd., the holding company for Olam International Ltd.’s rice milling assets in India, for $14.5 million. The transaction includes a rice milling facility in Haryana, India, that has the capacity to process 18 tonnes of paddy rice per hour.
In acquiring the facility, Ebro Foods said it will get a steady supply of basmati rice and will gain access to India’s large, high-growth domestic market for its portfolio of rice, pasta and sauces products. All employees in the plant will be transferred to Ebro and its sales network, the companies said.
“Olam is a global leader in the rice supply chain from Asia to Africa with a strong presence in both the sourcing origins and destination markets, supporting food security in many developing countries,” said Rajeev Raina, global head of Olam’s rice business. “India is an important sourcing origin for us. While the basmati part of the business provided some sourcing synergies, the sales and distribution channel was distinct and separate from the non-basmati rice business. Furthermore, significant investments in branding were required to grow the franchise. Through this sale we are monetizing more than the book value of fixed investments, as well as releasing working capital — which will be used to reinforce our core supply chain and trading business in non-basmati rice from India and other origins for our conventional markets.”Olam International Ltd. is a Singapore-based global, integrated supply chain manager of agricultural products and food ingredients, supplying various products across 16 platforms to more than 12,300 customers worldwide.