Naresh Patwari, who quit Boston-based private equity firm TA Associates to float mid-market PE investment house Jashvik Capital, and marked the first close of the maiden fund a few weeks ago, has struck its maiden deal.
Jashvik Capital is acquiring a significant minority stake in Jabsons Foods Pvt. Ltd, an ethnic savoury snacks company based in Bharuch, Gujarat. Founded in 1992 by Satyanarayan and Rahul Agrawal, Jabsons Foods is focused on healthy product categories based on peanuts, chana/chickpea, nut-based chikkis and namkeens.
It is fully backward integrated and sells its products across India through multiple channels and in international markets such as the US, Canada and the UK.
Rahul Agrawal, Director of Jabsons Foods, said, “We have known the Jashvik team for many years and are very impressed by their deep sectoral capabilities. We look forward to working closely with them to further strengthen our business, deepen our distribution and add more muscle to our organization. This partnership will help us further accelerate growth and increase the resilience of our organization.”
The firm said that India’s packaged snacks industry is around $10 billion and expected to grow at 13%. Jabsons is focused on ethnic packaged snacks, a segment that accounts for almost half of the total market and is growing faster at 16% on account of the shift towards ethnic snacks and shift from unorganized players to organized brands.
“We are very impressed with Jabsons’ portfolio innovation capabilities, brand loyalty among consumers, and management’s focus on rapid profitable growth,” said Naresh Patwari, Founder of Jashvik Capital.
He added that the ethnic snacks industry in India has a long runway for growth and presents an opportunity to build scaled defensible businesses.
Patwari had floated Jashvik Capital in July and is aiming to scoop up around $350 million under the maiden fund.
Jashvik Capital seeks to invest in profitable growth businesses in large addressable markets in healthcare/pharma and consumer sectors in India.
In August, the PE firm added two healthcare veterans as operating partners, Vijender Singh and Anil Matai. Operating partners are usually not directly involved in deal sourcing and making investments. But they use their domain experience to work with portfolio companies of the PE and venture capital firms to generate more value.
The PE firm would be seeking companies in healthcare and consumer-related industries and would be investing between $10 million and $50 million in a single company. It would focus on picking up minority stakes in the portfolio companies though it may do a few control deals, too, in the future.
Patwari had been associated with deals in companies like Indira IVF; nutritional supplements firm OmniActive Health; R&D informatics service provider Zifo; W brand of womenswear retailer TCNS; and quick-service restaurant operator Devyani International.
Before joining TA Associates eight years ago he had worked at ICICI Venture, McKinsey & Company and Schlumberger.