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Sister Act: For Yoga Bar’s Kumars, a sale to ITC is in the fitness of things

Yoga Bar today is a Rs 100 crore brand that’s available in 6,000 retail outlets and boasts gross margins of 40-50%.

Yoga Bar, Yoga Bar news, Yoga Bar latest news, ITC, ITC news
The cigarette-to-FMCG major has put Rs 175 crore on the table for a 39.4% stake to be picked up by February 2023.

The idea struck Anindita Sampath Kumar way back in 2014 when she stepped out of yoga class in New York and went looking for a protein bar. It didn’t take her long to convince her younger sister Suhasini that the two could make a business out of selling protein bars. 

Anindita quit her job with the M&A team at EY and they pooled in their savings of `25 lakh to start Sproutlife Foods (SFPL).

Along the way, they picked up $12 million from a clutch of investors, including Fireside Ventures, SAIF Partners and Alteria Capital. Yoga Bar today is a Rs 100 crore brand that’s available in 6,000 retail outlets and boasts gross margins of 40-50%. With the health foods market pegged at a whopping Rs 45,000 crore, there’s plenty of room to grow.

Also Read: ITC set to acquire 100% in health food brand Yoga Bar

Not surprising then that on Tuesday, Kolkata-headquartered ITC said it would acquire SFPL over a period of three to four years. The cigarette-to-FMCG major has put Rs 175 crore on the table for a 39.4% stake to be picked up by February 2023. Another 8.1% will be picked up in one or more tranches by March 31, 2025 for Rs 80 crore. The remaining stake would be bought on the basis of criteria that have been laid down by March 2026.

Interestingly, it was multinational foods giant Nestle that had been eyeing Yoga Bar, but the girls at SFPL seem to have been won over by the deal contours that ITC set out. Not just that, they were wowed by the ITC management’s hunger for new categories.

Also Read: ITC aggressive on agri drive via super app MAARS, targets 1,000-FPO network by March

As Suhasini told FE, the kind of support in terms of cash investments and the distribution network of four million outlets as also the flexibility to work in multiple categories swung the deal for ITC. “We felt ITC has managed to foray into multiple FMCG areas and gained market share in many of them. Nestle has kind of done well in infant food and noodles, with Maggi being a super strong brand, but is probably slightly less agile than ITC when it comes to expansion across categories,” she said. The MBA in Business and Economics from London Business School is also clear the ideal way to exit is to sell to a strategic buyer and not go down the IPO route. The sisters, who went to Cluny Convent school in Bengaluru, are also making cereal food for infants and children. The Yoga Baby brand comprises infant food formulations for babies older than six months made with millets and nuts. It could be gluten-free pizza next — something both Anindita and Suhasini love.

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First published on: 19-01-2023 at 03:30 IST
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