Patanjali Foods Ltd to Acquire Patanjali Ayurved Business

Patanjali Foods Ltd, led by Baba Ramdev, is set to acquire Patanjali Ayurved Ltd (PAL) ‘s home and personal care business for ₹1,100 crore. This acquisition is classified as a related party transaction conducted on a fair value and arms’ length basis.

Patanjali Foods Scope of Acquisition:

The acquisition encompasses the entire non-food business of PAL, including hair care, skin care, dental care, and home care products. Specifically, it involves:

• Movable assets
• Immovable properties
• Contracts
• Licenses
• Books and records
• Employees
• Certain assumed liabilities

Approval and Funding

The acquisition is pending approval from shareholders, lenders, and other necessary authorities, including the Competition Commission of India. Patanjali will finance the acquisition through internal cash reserves, with the ₹1,100 crore payable in five tranches.

The acquisition includes major brands such as Dant Kanti and Kesh Kanti. The acquired business generated a turnover of around ₹2,800 crore in the last fiscal year. Patanjali Foods’ CEO, Sanjeev Asthana, anticipates the deal to be concluded within the current quarter.

Patanjali Foods Expected Synergies:

The acquisition is expected to bring multiple synergies:

• Brand equity and enhancements
• Product innovations
• Cost optimisation
• Infrastructure and operational efficiencies
• Positive impact on market share

Patanjali Foods emphasized that the home and personal care business transfer was mutually negotiated and valued by independent valuers, resulting in a lump sum consideration of ₹1,100 crore.

This strategic move aims to bolster The firms market position and expand its footprint in the home and personal care sector.

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