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In a strategic move, South Korea-based confectionery company, Lotte Wellfood, has decided to merge its Indian subsidiaries Lotte India and Havmor Ice Cream to establish an integrated entity in India. The company said the move is part of its strategic initiative, “One India” to ramp up growth momentum in the Indian confectionery & ice cream market. The merger is expected to get completed by the second half of this year. Lotte Wellfood also announced its plans to set up a new ice-cream production facility for Havmor with an investment of ₹400 crore in Pune, Maharashtra to expand its reach from the west to the south-central regions of India.
“With this merger, the integrated entity will aim to achieve an annual sales of about ₹6,000 crore through a series of investments and secure future growth drivers,” the official statement added.
Robust growth
Chang-Yeop Lee, CEO of Lotte Wellfood, said “With the launch of One India strategy, we aim to solidify Lotte’s brand presence and secure growth momentum in the Indian market. Our long-term vision includes substantial investments in India, a key emerging market with the world’s largest population and robust economic growth. The merger of our Indian subsidiaries is a strategic move to enhance management efficiency and maximize synergy.”
He added that the focus will be on strengthening the local Lotte brand through diversified product portfolios and the integration of logistics and production bases to garner higher sales and market share.
On July 29, the Board of Directors of Lotte India and Havmor each approved the merger plan. “The merger will take the form of Havmor Ice Cream integrating with Lotte India and both the brands will continue to retain the individual identities for seamless operations. The merger process is expected to be completed by second half of this year, with the new integrated entity set to launch early next year,” the company said.
Lotte India had earlier invested over ₹210 crore to establish the production base for Lotte Pepero at its Haryana factory. This will begin operations in the second half of next year. “Following Lotte Choco Pie, the company plans to develop and introduce localized versions of Lotte Pepero that reflect local eating habits and climate conditions,” it added.
Lotte Wellfood entered the Indian market in 2004 by acquiring Parrys, an Indian confectionery company, and renaming it Lotte India. In December 2017, Lotte acquired Havmor Ice Cream,.
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