Milky Mist Dairy Food is in talks with private equity funds corresponding to Chryscapital , Kedaara, Multiples, True North, TA and Temasek to lift $100-120 million in what could be its first institutional funding , 4 individuals with direct data of the matter mentioned.
“The final binding bids are expected to be in towards the end of the month or early next month. The deal is likely to close next quarter,” mentioned one of many individuals.
The dairy and contemporary meals firm has appointed Chennai-based funding financial institution Veda Corporate Advisors to assist it with the funding course of.
Spokespersons for Temasek and Veda Corporate Advisors declined to remark. Spokespersons for Multiples, Kedaara, True North, TA, ChrysCapital and Milky Mist didn’t reply to emailed queries until press time Sunday.
Milky Mist was arrange by T Sathish Kumar, a highschool dropout hailing from a household of farmers, in 1992. It started with promoting milk and has entered value-added merchandise corresponding to milkshakes, flavoured yogurt, butter, cheese variants and UHT merchandise. The firm has a 55-acre plant in Perundurai, Tamil Nadu, and provides by a retail community of greater than 1,50,000 retailers.
It has tied up with 60,000 dairy farmers to course of 1.5 million litres of milk every day. It generates annual income of Rs 1,300-1,400 crore, the individuals mentioned.
“The company expects a valuation multiple akin to FMCG companies,” mentioned a second individual instantly concerned in the deal. According to this individual, the corporate is worthwhile, and the deal is gaining quite a lot of traction from consumer-focused fund
“The company currently has a strong presence in southern India and with its plans to become a pan-India brand, it needs capital to scale,” mentioned one other individual with data of the corporate’s plans. “It will look at raising $100-150 million given the inbound interest and is likely to sell a significant minority stake in an entirely primary round,” he added.
Milky Mist, which has been bootstrapped, had beforehand raised debt from Anicut Capital, a enterprise debt fund.
The organised dairy and contemporary meals sector is gaining momentum with traders. The dairy sector is about for the second straight fiscal 12 months of double-digit income development at 11-12%, a notch under final fiscal’s 13% development, in response to
Ratings. The development is pushed by wholesome demand for value-added merchandise (28% of general gross sales), whilst gross sales of liquid milk keep regular and the full-year advantage of retail worth hikes applied final fiscal 12 months is realised. Within value-added merchandise, robust restoration is predicted in the demand for chilly VAP corresponding to ice-cream, curd and flavoured milk, ET reported final month.
