Patanjali Foods limited to acquire Patanjali Ayurved’s home, personal care biz for Rs 1,100 crore. Patanjali Foods will buy ‘Home and Personal Care’ business of Patanjali-Ayurveda: Deal will be done for Rs 1,100 crore, company’s shares rose 7.45%

The board of Patanjali Foods Limited has approved the proposal to purchase the ‘Home and Personal Care’ business of its parent company Patanjali Ayurveda. To buy this business, Patanjali Foods will spend Rs 1,100 crore on lumpsum valuation.

Patanjali Foods wants to become the leading FMCG company, hence it is making acquisitions. The Home & Personal Care business of Patanjali Ayurveda Limited (PAL) currently has a strong brand equity in the FMCG space of India. Apart from this, it has a loyal consumer base across the country.

Patanjali’s four key segments

Patanjali Foods shares rose 7.45% today
This news has come after the market closed. At the close of trading today on Monday, the shares of Patanjali Foods Limited closed at Rs 1,710 with a rise of 7.45%.

With this the market cap of the company has become Rs 58.54 thousand crore. In the last one year, the company’s shares have given 43.49% returns to its investors.

20 year licensing agreement agreed upon
Patanjali Foods said that the company and Patanjali Ayurveda have agreed to a 20-year licensing agreement for 3% turnover based fees as well as other terms. This acquisition will lead to integration of FMCG product portfolio of Patanjali brand.

The company has also said that this is a big step in its journey to become a major player in the FMCG sector. The company had made this commitment to its shareholders at the time of its first FPO.