KOLKATA: McLeod Russel India is eyeing another acquisition to consolidate its position among the world's largest producers of bulk tea. Alongside, the company is mulling an entry into the premium packet tea segment, which it plans to distribute through Eveready Industries India, another company in the Williamson Magor group.

Addressing a press meet here on Monday, Aditya Khaitan, Managing Director, McLeod Russel, said the company was keen to expand further. "We will not acquire a single garden and the minimum capacity should be five million kg either in Assam or in Africa". He said things could materialise, if a suitable buy was found, only after October. He said the integration of Moran Tea with the company, the process of acquisition of which is now on, was set to be completed in the next few months. Since 2005, McLeod Russel's capacity has increased steadily from six million kg to 75 million kg now through mergers and acquisitions (of Doomdooma, Moran and Williamson Tea Assam). McLeod Russel, which exported an all-time high of 25 million kg of tea in 2006, has gardens in Assam and West Bengal. It exited from its four gardens in Darjeeling in 2000-01 since it did not give volumes, Mr. Khaitan said. The company now has 35,000 hectares under tea cultivation with a direct workforce of 80,000 people.

With a Rs. 7 per kg increase in selling price, McLeod Russel's profit before tax, interest and depreciation, increased to Rs. 89 crore during 2006-07 from Rs. 39 crore in 2005-06, while the turnover increased to Rs. 606 crore from Rs. 511 crore. However, the figures are not strictly comparable, since they include Doomdooma's amalgamation from April 1, 2006.

The company has also reduced its consolidated debt by Rs. 163 crore to Rs. 403 crore through the sale of some of its investments and allotment of shares worth Rs. 120 crore under Qualified Institutional Placement.

On its packet tea plans, Mr. Khaitan indicated that an internal study was now being done to assess the volumes that could be gained through this foray which would also include tea bags. However, he re-iterated that while the distribution would be through Eveready's network, the endeavour would be to add premium brands to the three existing portfolios of Eveready Industries.

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