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The board of Ruchi Soya Industries Ltd has approved rechristening the company as Patanjali Foods, according to a BSE filing. The transaction will include the transfer of employees, assets (excluding brand, trademarks, designs and copyrights), current assets including vehicles, cash and bank balance, contracts, licenses and permits, distribution network and customers.
1. Ruchi Soya To Be Renamed Patanjali Foods Company Board
The renaming of Ruchi Soya to Patanjali Foods Company is a significant development for the Indian FMCG industry. It is expected to bring in several benefits, including greater market penetration and increased revenue for both companies. The rebranding will also help to boost brand recall among consumers. The move is part of the larger strategy by the Patanjali group to become a global leader in the consumer goods sector.
The board of the Ruchi Soya Industries Ltd has approved the acquisition of food business of Patanjali Ayurved Limited for Rs 690 crore. The acquisition will include all fixed assets, current assets, and manufacturing plants of the food division, which includes 21 major products, such as ghee, honey, spices, juices, and atta. The acquisition will be completed by July 15.
Ramdev-led Patanjali Ayurved had raised about Rs 4,300 crore through a follow-on public offer (FPO) in April. This will be used to partly retire the debt of the company.
Following the announcement of the name change, shares of the company surged by 10%. This is a clear indication of investor confidence in the company’s future growth potential. The renaming is expected to create a unified brand identity, which will improve market positioning and lead to higher revenue.
The move to rename the company to Patanjali Foods will also allow it to take advantage of the strong distribution network and customer base of Patanjali Ayurved. It will also allow the company to take advantage of synergies in areas such as supply chain management and distribution channels. The renaming is expected to improve the brand recognition and brand recall for both companies, leading to better market positioning and a larger customer base.
Moreover, the renaming of the company will make it easier for investors to differentiate between the two companies. This will allow investors to more easily track the performance of each company and make better investment decisions. The renaming will also increase the visibility of Patanjali’s food products, which have been growing rapidly in recent years. This will strengthen the company’s position in the market and allow it to compete with leading players such as Nestle.
2. Patanjali Ayurved To Sell Food Retail Business To Ruchi Soya
In a move to accelerate its shift to a leading FMCG company, Baba Ramdev’s Patanjali Group will acquire the food retail business of Ruchi Soya for Rs 690 crore. The acquisition is expected to boost the food portfolio of Patanjali and help in increasing revenue.
The acquisition will include the food retail business of the listed subsidiary Ruchi Soya Industries Limited including manufacturing, packaging, labelling and retail trading of certain food products. The acquisition will also include manufacturing plants located at Padartha district, Haridwar in Uttarakhand and Newasa unit in Maharashtra.
Founded in 1974, Ruchi Soya Industries Limited is engaged in the manufacture and marketing of a healthy range of edible oils and soya foods in India. The Company has approximately 22 manufacturing units which have a refining capacity of over 11000 tons per day and seed crushing capacity of 11,000 tonnes per day. The Company’s product portfolio includes Nutrela brand of edible oil, Vanaspati and bakery fats, Soya Chunks and Soya Granules.
As of December 2018, the company had an average daily turnover of about 1,428 million (US$24.2 million) and a net profit of 1,170 million (US$25.2 million). The company’s market share is estimated at 22% in edible oil, 16% in vanaspati, 12% in bakery fats and 21% in Soya foods.
The company is undergoing a complete transformation from a commodity-based company to an FMCG & Wellness company with strong international footprints. The transformation is being driven by a focus on important strategic priorities, creating a seamless integrated organisation structure where all BUs and functions operate in a coherent manner to achieve larger objectives, investments in talent and capacity building, leveraging digital technology and adopting robust risk management practices.
Moreover, the company has also been focusing on expanding its distribution network and improving its efficiency. In the recent past, it has rolled out several initiatives including e-commerce and mobile apps. In addition to this, the company is also planning to enter the dairy and health drinks businesses in the near future. In order to accomplish the expansion plans, the company will be investing in the infrastructure and establishing state-of-the-art facilities.
3. Patanjali Ayurved To Sell Food Retail Business To Ruchi Soya
Yoga guru and businessman Baba Ramdev-led Patanjali Ayurved is selling its food retail business to its listed subsidiary Ruchi Soya Industries in a deal worth Rs 690 crore. The move is aimed at speeding up the company’s transition into a leading FMCG (fast-moving consumer goods) firm. The transaction comprises 21 major products — including ghee, honey, spices, juices, and atta. The acquisition will also include transfer of employees, assets (excluding the brand, trademarks, designs, and copyrights), current assets (excluding debtors, vehicles, cash and bank balance), contracts, licenses and permits, distribution network, customers related to the Food Retail Business Undertaking of PAL, the company said in a statement.
The company will evaluate the most efficient mode to enhance synergies with the Patanjali Ayurved Limited food portfolio on an arm’s length basis, it added. The transaction, which was completed on July 1, will also see the company change its name to Patanjali Foods Industries Ltd, it added.
In addition, the Board has approved investment in equity share capital of Gemini Edibles and Fats India Pvt Ltd – a Company belonging to Promoters Group with Ruchi Soya Industries Limited (“Ruchi Soya”). The investment will enable the Company to expand its edible oil business through its refinery in Maharashtra.
The Board has also approved the proposal for issue of new shares by the Company to meet its working capital requirements. The proposed issue will be made to qualified institutional investors on a private placement basis. The issue will be priced at a premium to the existing prevailing price of the shares in the market.
The Board also approved the appointment of Shri Kumar Rajesh as Chief Financial Officer of the Company with effect from July 1, 2022. The Board has received the necessary declaration from each of the independent directors that they meet the criteria for independence laid down under Section 149(6) of the Companies Act, 2013 read with the schedules and rules made thereunder and Regulation 16(1)(b) of the Listing Regulations.
4. Patanjali Ayurved To Sell Food Retail Business To Ruchi Soya
In a major development, Yoga guru and businessman Baba Ramdev-led Patanjali Ayurved has signed an agreement to sell its food retail business to Ruchi Soya for Rs 690 crore. The transaction, which is on a slump sale basis, will see Ruchi Soya Industries acquire the food business of Patanjali Ayurved comprising 21 major products like ghee, honey, spices, juices and atta.
The acquisition will be made in exchange for the existing equity shares of PAL which are being transferred to RSIL. It will also include the transfer of all employees, current assets (excluding debtors, vehicles, cash and bank balance), contracts, licenses and permits and customers related to the Food Retail Business Undertaking of PAL.
Besides this, the company will also get access to the brand value, market reach and customer base of Patanjali Ayurved, which is one of India’s fastest-growing FMCG companies. The deal is expected to boost the company’s revenue by more than 18% in FY2023.
This will also help the company become a leading consumer packaged goods (CPG) player in the country and will help it expand its footprint across India. It will also provide it with access to a wider network of distributors. The company is currently working on expanding its presence in international markets.
Ruchi Soya is based out of Mumbai and is listed on the BSE. It is the largest branded oil packaged food company in India with a strong portfolio of cooking oils, including brands such as Ruchi Gold, Mahakosh, Sunrich and Nutrela. Its products are sold in over 1 lakh stores nationwide. In addition to its food business, it is also into oil palm plantation and renewable wind energy businesses.
The company’s board has approved changing the name of its company to Patanjali Foods Limited subject to requisite statutory and regulatory approvals. The change is effective from April 10. Additionally, the board has given its in-principle approval to enhance synergies with the food portfolio of Patanjali Ayurved Limited on an arm’s length basis. The board also authorized its officials to negotiate, finalize, execute and deliver the terms of the proposed transaction.
