In a strategic move to consolidate and expand its market presence, Patanjali Foods Limited is deliberating the purchase of the non-food business segment from Patanjali Ayurved Limited (PAL), both entities under the umbrella of Baba Ramdev. The proposition includes popular consumer products like toothpaste, oils, soaps, and shampoos.
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During a recent board meeting held on Friday, Patanjali Foods Limited explored the initial proposal from PAL. The board expressed initial approval to evaluate potential synergies that could arise from integrating PAL’s non-food assets, ensuring the process adheres to an arm's length principle.
According to a detailed disclosure to the stock exchange, Patanjali Foods is set to engage in comprehensive due diligence. The company will enlist experts to fine-tune the terms of the acquisition and conduct a thorough evaluation before any final decisions are made. This diligence will be reported back to the Audit Committee and Board for subsequent deliberation.
This potential acquisition aligns with Patanjali Foods’ history of strategic business expansions under the Patanjali banner. The company had previously acquired the biscuits business from Patanjali Natural Biscuits Private Limited for Rs 60.03 crore in May 2021, and not long after, the noodles and breakfast cereals for a sum of Rs. 3.50 crore in June 2021. The acquisition trail continued with a substantial purchase of the food business in May 2022 for Rs. 690 crore from Patanjali Ayurved Limited.
"The proposal received from PAL may offer synergies to the Company's product portfolio with an array of brands and contribute to the growth in terms of revenue and EBITDA," stated the official stock filing. This move could significantly bolster Patanjali Foods' position in the non-food sector, expanding its footprint in the fast-moving consumer goods (FMCG) industry.
Established in 1986 and formerly known as Ruchi Soya Industries Limited, Patanjali Foods Limited is a dominant player in India’s FMCG sector. The company boasts a diverse product line including edible oils and a range of food and non-food FMCG products, alongside ventures in wind power generation. With brands like Patanjali, Ruchi Gold, and Nutrela under its belt, Patanjali Foods continues to enhance its market share and brand presence across India’s booming consumer market.