Patanjali Foods Limited (PFL) has secured board approval for the acquisition of the Home and Personal Care (HPC) business from Patanjali Ayurved Limited (PAL) for a lump sum of Rs 1,100 crore.
This acquisition is a major step in PFL’s move to becoming a leading fast-moving consumer goods (FMCG) company in India by capitalising on the strong brand equity of PAL.
The deal encompasses PAL’s HPC business, which spans across four major segments: dental care, skin care, home care, and hair care. It includes all related assets and liabilities, along with employees, distribution networks, contracts, licenses, permits, consents and approvals necessary for its operations.
A licensing agreement has also been negotiated, which includes a 3 per cent turnover-based fee and other conditions, allowing PFL to utilise trademarks and intellectual property owned by PAL that are critical to the HPC product portfolio.
Patanjali Foods said that this acquisition would significantly enhance its existing FMCG product portfolio, bringing in a range of marquee brands expected to drive notable growth in revenue and EBITDA. The consolidation of the ‘Patanjali’ brand within PFL’s portfolio is anticipated to yield multiple synergies, including enhanced brand equity, opportunities for product innovations, cost optimisation, improved infrastructure and operational efficiencies, ultimately leading to a stronger market share.
The completion of the acquisition is contingent upon various regulatory approvals required for the business transfer. Following the board’s approval, PFL will move forward with executing definitive agreements related to the acquisition and obtaining the necessary regulatory clearances.
Advised by Jefferies India Private Limited, Patanjali Ayurved Limited has strategically positioned PFL for significant growth and expansion through this transaction. Founded in 1986, Patanjali Foods Limited has established itself as a premier player in India’s FMCG sector, with a diverse portfolio that includes Patanjali, Ruchi Gold and Nutrela, operating across segments such as edible oil, food & FMCG, and wind power generation.
_20240527192124_original_image_21.webp)
