Patanjali Foods Limited (NSEI:PATANJALI) entered into a business transfer agreement to acquire Home and Personal Care business of Patanjali Ayurved Limited from Patanjali Ayurved Limited for INR 11.0 billion on July 1, 2024. As part of consideration, INR 11 billion is paid towards assets of Home and Personal Care business of Patanjali Ayurved Limited, payable by the Company to the Seller in tranches as per the following details: (i) 1st Tranche: 20% of the Purchase Price i.e., INR 2.2 billion shall be paid within 10 Business Days from receipt of each of the following approval from the Competition Commission of India for consummation of the Transaction, receipt of approval by the shareholders of the Company for consummation of the Transaction and receipt of approval from the lender of the Company i.e. State Bank of India, (ii) 2nd Tranche: 20% amount of the Purchase Price i.e., INR 2.2 billion shall be paid within 10 Business Days from receipt of in principle written approval, by all the lenders of the Seller for the consummation of the Transaction, (iii) 3rd Tranche: 45% amount of the Purchase Price i.e., INR 4.95 billion shall be paid within 30 Business Days from the Effective Date, (iv) 4th Tranche: 10% amount of the Purchase Price i.e., INR 1.1 billion shall be paid within 10 Business Days after receipt of No Dues Certificate by the lenders of the Seller and release of charge over the Undertaking Assets, and (v) 5th Tranche: 5% amount of the Purchase Price i.e., INR 5.5 billion shall be paid within 10 Business Days of conveyance of all the Properties. The acquisition of the entire non-food business undertaking i.e. hair care, skin care, dental care and home care carried out by Patanjali Ayurved Limited (PAL), including but not limited to all movable assets, immovable properties, contracts, licenses, books and records, employees and certain assumed liabilities of PAL through a slump sale arrangement on a going concern basis.

The board of Patanjali Foods Limited has approved the proposal and shall now take necessary steps to execute the definite agreements in connection with the acquisition as well as apply for necessary approvals integral to the transaction. With this acquisition, the company has reaffirmed its position to be a strong FMCG company in its journey towards becoming a major player in the FMCG space as committed to its shareholders at the time of its maiden FPO. Separately, a licensing arrangement for a 3% turnover based fee along with other conditions has been agreed between the Company and PAL.

Jefferies India Private Limited acted as financial advisor for Patanjali Ayurved Limited.