Nestle India has apparently paid a whopping Rs. 20 crore to Ambuja Cements for destroying their Maggi instant noodles that had established it’s monopoly once-upon-a-time, since they were found to be harmful for human consumption by the food regulators in the country.
Ambuja Cements, formerly known as Gujarat Ambuja Cements, is believed to have been paid the amount for “burning the recalled packets” of Maggi noodles at its cement plant in Chandrapur in Maharashtra. When contacted, a Nestle India official spokesperson stated, “Gujarat Ambuja Cements is… helping us destroy the Maggi noodles being withdrawn by us from the market,” in his statement to the media.
While the spokesperson did not confirm the actual cost involved in the process he mentioned, “In addition to the value of stocks being destroyed there will be additional costs to take into account, for example bringing back stock from the market, transporting the stock to the destruction points and destruction cost etc.”
Nestle India said that these costs and “other miscellaneous unforeseen costs” associated with the withdrawal will be dealt with in line with the applicable accounting standards at the time of announcing the financial results on the due dates. Last month, Nestle India said it is in the process of destroying Maggi instant noodles worth Rs. 320 crore after it was banned by the central food safety regulator FSSAI, due to presence of lead and taste enhancer monosodium glutamate (MSG) beyond permissible limits.
On June 5, FSSAI banned Maggi directing Nestle to immediately withdraw and recall all nine variants of Maggi instant noodles from market. Nestle India has also recalled the product from the market. The company has challenged the ban order in the Bombay High Court.
Tags: Ambuja Cements
