Nestle says it spent Rs20 cr to recall and destroy Maggi noodles: report

It is a double whammy for foods giant Nestle. Having lost over Rs320 crore in stocks of Maggi instant noodles withdrawn from shelves across the country, the company is reported to have spent an additional Rs20 crore to destroy those packets.

Besides the cost of withdrawal, Nestle is believed to have paid Ambuja Cements, formerly known as Gujarat Ambuja Cements, for burning the recalled Maggi noodles packets at its cement plant in Chandrapur in Maharashtra, according to a PTI report.

"Gujarat Ambuja Cements is... helping us to destroy the Maggi noodles being withdrawn by us from the market," the report quoted a Nestle spokesman as saying.

"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," the spokesperson said without confirming the cost involved in burning Maggi at Ambuja Cements plant.

Nestle India said these costs and other 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.

On 5 June, food regulator the Food  Safety and Standards Authority of India (FSSAI) banned the sale of Maggi instant noodles and directed Nestle to immediately withdraw and recall all nine variants of Maggi instant noodles from the market.

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.

Nestle India has challenged the ban order in the Bombay High Court.