Danone plans health drinks' JV

NEW DELHI: Groupe Danone is close to formalising a joint venture with the Mumbai-based Narang Hospitality Services for manufacturing, marketing and distributing nutritional beverages such as fortified water and juices in India.

Danone India, a wholly owned subsidiary of the French food group, will hold a minority stake in the joint-venture company, Quarisma Beverages, which will be controlled by the Rs 300-crore Narang group.

Confirming the development to ET, Rahul Narang, MD and CEO of Narang Hospitality Services said: “Quarisma Beverages will leverage potential of packaged nutritional beverages, especially in urban Indian markets.”

Details of the stakeholding pattern were not available. The venture is to be announced in about two weeks’ time.
Groupe Danone declined to comment on the development.

Danone India already has a tie-up with Narang Hospitality for importing and distributing its premium packaged water brand Evian in India. Quarisma Beverages will takeover this business as well as Narang group’s existing premium packaged water brand Qua.

It will also manufacture, market and distribute a fortified functional water brand Qua Plus and launch a mass market packaged water brand in the first quarter of 2011 to compete with brands like Bisleri, Aquafina and Kinley, Mr Narang said.

Fortified juice is another category Quarisma will consider launching early next year, he added. It could not be ascertained if Danone plans to bring in any of its beverage brands other than Evian through this venture.

The world’s largest dairy product firm, which got the nod to enter India on its own last year after a two-year battle with erstwhile partner Nusli Wadia group, will enter the Indian dairy and nutritional foods businesses through Danone India. It’s already test-marketing flavoured milk in the country under the name Choco Plus milk.

It also has a joint venture with Japanese firm Yakult Honsha for manufacturing, marketing and distributing probiotic drink Yakult in India.

Narang Hospitality markets beverages under Narang Premium Beverages. In 2000, it was named the marketing, sales and partner for energy drink Red Bull in India. Three years later, it tied up with Danone for distributing Evian, while in ’07 it was appointed sales, distribution and marketing partners for Italian coffee chain Illy caffe.

Last year, Narang group launched its own packaged water brand Qua besides picking up sales, distribution and marketing rights for Swiss chocolates brand Lindt in India.