BENGALURU: ITC pulled out of the race to buy Horlicks and Complan because it considered the valuations of these brands too high and something which did not fit into its portfolio, a top executive said. The company has already indicated that it is keen to get into the health food segment and now that it is out of contention for the two products, it will in all probability, build one of its own to diversify. ITC pulled the plug for GlaxoSmithKlineowned Horlicks bid early while it showed scant interest in Complan, owned by Kraft Heinz.
“These were opportunities that just came up in the last few months. We evaluated and looked at some of these valuations and found the cost of acquisition to be very high. Given the high FMCG valuations in India, such acquisitions could be a challenge. In this context, we are not pursuing it,” Hemant Malik, divisional chief executive of ITC Foods, told TOI.
Malik agreed that the health drinks segment is an interesting space, something that will be part of the company’s future portfolio and a space that cannot be “ignored”. “We will be looking at that space through our new brand.” The bid for Horlicks has attracted global conglomerates Nestle, Unilever, Reckitt Benckiser, Kellogg’s and even Pepsi and Coca-Cola. The cola giants are looking to diversify beyond their stronghold of sugary carbonated drinks at a time when consumers are looking out for healthier options.