United Arab Emirates-based supermarket chain Lulu Group has bought a 10 per cent stake in UK-based trading firm The East India Company and a 40 percent stake in its fine foods subsidiary for around $82 million in total.
The new investment will enable the fine foods unit to expand its store network in Europe, the Far East and prepare for a launch in the United States, MA Yussufali, managing director of Lulu Group, said after finalising the deal in London on Wednesday.
We will support East India Company to develop into a truly global luxury brand and will deliver great results in the coming days. I am sure our alliance will help the Company to expand its business in new regions and markets’ said Yusuff Ali. ‘We have great plans for the future and will try our best to bring back the past glory of East India Company in this new era’ he added.
Abu Dhabi-headquartered firm is investing approximately $82 million in two phases for the stakes it is buying.
The East India Company Fine Foods sells luxury foods including tea and chocolate and has four stores in the UK and three in the Middle East. It also distributes through retailers in 16 countries. It joins Mahindra Group as an investor in The East India Company. The Indian conglomerate first bought into the firm in 2010 and made a further investment in 2013.
In May, Lulu announced expansion in Malaysia with plans to open six new halal-only hypermarkets with an investment of $200 million.
Originally founded as 'The Company of Merchants of London trading into the East Indies', by a royal charter on the last day of 1600, EIC had grown into the largest trading house in the world, accounting for nearly half of the global trade at one point. During its period of growth, the company diversified from spices to tea, cotton, silks, indigo and opium, while shifting its focus from commerce to conquest.
After the British monarchy dissolved its powers in 1874, EIC remained dormant till 2010, when India-born entrepreneur Sanjiv Mehta revived the brand name. Over a four-year period, he acquired the entire stake of the company from its 33 shareholders and opened a flagship store in Mayfair selling tea, chocolate, coffee, wines, jams, mustard and biscuits.
Lulu Group has operations in 32 countries, with staff strength of 31,000 and reported revenues of $5.4 billion during calendar year 2013.