French dairy giant Danone has made an investment which takes it back into the Indian dairy sector, which it exited last year.
The company has taken a stake in the Indian yogurt business Epigamia, as part of a US$25.6m investment round, via its New York-based Danone Manifesto Ventures vehicle.
Last January Danone said it would no longer sell dairy products in India, instead focusing on nutrition products, including brands such as Protinex and Aptamil, in the market.
The dairy giant said it had decided to “rationalise its product portfolio” in India, a move it said would “allow for accelerated investments and a sharper focus on growing its nutrition portfolio”.
But now it has at least put a toe back into the water of the Indian dairy sector via a Series C funding round led by Belgium’s Verlinvest.
However, a spokesperson denied it was re-entering the sector but said the deal amounted to “an exciting ‘lab’ for Danone”.
Mumbai-based Epigamia, the brand name used by Drums Food International, said that it will use the latest capital infusion to expand its distribution network across 25 cities in India. It will also expand its range of high-protein, lactose-free and probiotics food products.
The company was founded in 2015 by Mirchandani, Ganesh Krishnamurthy and Uday Thakkar.
Rohan Mirchandani, CEO at Drums Food, said: “Danone is the global leader in our space and with the support from their venture arm, we expect to execute an ambitious business plan,”
Laurent Marcel, managing director at Danone Manifesto Ventures, said: “We are convinced of Epigamia’s great growth potential thanks to its unique positioning on the Indian dairy market. As a modern and innovative brand, it appeals to the ever-growing number of Indian consumers looking for healthier options.
“This investment, our first with Danone Manifesto Ventures in Asia, is a perfect fit, as Epigamia places taste, quality and health at the centre of its model. We look forward to putting Danone’s resources and expertise to use in supporting Epigamia’s talented team as their business continues to expand across India.”