Home-grown FMCG company Dabur on Wednesday announced that it will acquire Sesa Care, maker of Ayurvedic personal care and wellness products, at an enterprise value of Rs 315-325 crore.
It has entered into an agreement to acquire the majority 51% stake from private equity fund True North for Rs 12 crore at face value.
“The enterprise value is estimated to be in the range of Rs 315-325 crore, including debt of Rs 289 crore, which will be backed by the corporate guarantee of Dabur,” it added.
There will be a share swap for the equity shares for the remaining 49% shares in Sesa. The acquisition is likely to be completed in the next 15-18 months.
Sesa Care, the third largest player in the ayurvedic hair oil category, had a consolidated turnover of Rs 133.3 crore in 2023-24.
“This presents a strategic opportunity for Dabur to expand its presence in the Rs 900 crore ayurvedic hair oil market – a key whitespace in Dabur’s current hair oil portfolio,” the company said.
Dabur India, which is already present in the segment with its brands like Dabur Amla Hair Oil, Dabur Vatika and Dabur Almond Hair Oil, said that the proposed merger brings “substantial revenue and cost synergies”.
“This merger aligns with our tong-term vision to consolidate our portfolio and tap into newer growth opportunities,” said Mohit Malhotra, chief executive officer at Dabur India.
The acquisition would be subject to regulatory clearances, and the approval of the National Company Law Tribunal.
In the past few years, Dabur India has made several acquisitions in the hair care and personal wellness category. In 2016, it entered a deal with South Africa’s CTL Group of Companies to acquire its Personal Care, Hair Care and Creams businesses for around $1.5 million.
Before that in 2010, the company entered into the hair care market in Africa with the acquisition of the Namaste Group. In the same year, it acquired Turkish personal care products company Hobi Kozmetik Group, for $69 million.
It has also been focusing on diversifying its product range. In 2022, Dabur India acquired a majority stake in Badshah Masala to enter the branded spices and seasoning market. The acquisition was done at an enterprise value of Rs 1,152 crore.
On Wednesday, the company said that it is looking for more targets.
“Sesa allows us to fill a strategic whitespace. We will continue to actively look for additional targets in both traditional and new age areas,” said Abhinav Dhall, executive director and group head of corporate strategy at Dabur India.
From: financialexpress
Financial News
