Patanjali Foods Ltd is set to acquire the home and personal care business of Baba Ramdev-led Patanjali Ayurved Ltd (PAL) for ₹1,100 crore. This strategic acquisition, approved by the board of Patanjali Foods, involves the transfer of PAL’s non-food business assets including hair care, skin care, dental care, and home care segments. The transaction falls under related party transactions, conducted on a fair value and arms' length basis.
Strategic Acquisition to Boost Market Presence
The acquisition encompasses all movable and immovable assets, contracts, licenses, books and records, employees, and certain assumed liabilities of PAL through a slump sale arrangement on a going concern basis. However, this deal is contingent upon receiving approvals from shareholders, lenders, and the Competition Commission of India.
Financial Details and Future Prospects
According to Patanjali Foods CEO Sanjeev Asthana, the ₹1,100 crore acquisition cost will be paid in five tranches, funded through the company’s internal cash reserves. The deal is expected to conclude within the current quarter, bringing major brands like Dant Kanti and Kesh Kanti under Patanjali Foods' portfolio. The acquired business recorded a turnover of around ₹2,800 crore in the last fiscal year.
The filing noted that independent valuers have mutually negotiated and valued the transfer, aiming to leverage multiple synergies. These include enhanced brand equity, product innovation, cost optimization, improved infrastructure and operational efficiencies, and a positive impact on market share. The acquisition is poised to significantly strengthen Patanjali Foods' position in the home and personal care market, aligning with the company's growth strategy and market expansion goals.
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