Tata Tea Enters Beverage Alliance with PepsiCo for Health Drink

Tata Tea said the two companies would finalise definitive agreements for the joint venture over the next few months. Tata Tea is part of the Rs 3.25-lakh crore ($70.8-billion) Tata group.

12 Apr 2010 --- Tata Tea Ltd has signed a memorandum of understanding (MoU) with global beverages major PepsoCo Inc to explore the possibility of forming a joint venture for the production and distribution of non-carbonated ready-to-drink beverages, focused on health and enhanced wellness.

The board of Tata Tea Ltd approved a non-binding memorandum of understanding with PepsiCo Inc, with the intention of exploring the formation of a joint venture in the area of non-carbonated ready-to-drink beverages, focused on health and enhanced wellness, Tata Tea said in a regulatory filing.

Tata Tea said the two companies would finalise definitive agreements for the joint venture over the next few months. Tata Tea is part of the Rs 3.25-lakh crore ($70.8-billion) Tata group.

The proposed joint venture will not be in conflict with any existing arrangements of either parties and the transaction will be subject to corporate and statutory approvals as may be required, the release said.

Tata Tea has a 100 per cent export-oriented unit manufacturing instant tea in Munnar, Kerala, which is the largest such facility outside the United States. The unit uses a unique process developed in-house for extraction from tea leaves, giving it a distinctive liquoring and taste profile.

Instant tea is used for light density 100 per cent teas, iced tea mixes and in the preparation of ready-to- drink (RTD) beverages. The Munnar unit is KOSHER and HACCP certified, according to information available on the companys web site.

With about 15,900 hectares under tea, Tata Tea produces around 30 million kg of black tea annually. It has five major brands in the Indian market - Tata Tea, Tetley, Kanan Devan, Chakra Gold and Gemini - catering to all major consumer segments for tea.

The Tata Tea brand, a mrket leader in terms of both of value and volume sales in India, has been recognised as a `Super Brand in the country.

With a distribution network of 38 C&F agents and 2,500 stockists, the company caters to over 1.7 million retail outlets in the country.

The Tata Tea group of companies, which includes Tata Tea and the UK-based Tetley Group, is also the worlds second largest global branded tea operation with product and brand presence in 40 countries. With a focus on branded product offerings in tea anda significant presence in the tea producing and consuming regions, Tata Tea is also Indias first multinational companies.

PepsiCo India, part of the US-based global consumer products giant PepsiCo Inc, is increasingly focusing on health foods even as it continues its lead in carbonated beverages and convenience foods.