Patanjali Foods Hits Record On Plans To Buy Sister Unit's Non-Food Business

Patanjali Foods Ltd. rose to a record high on Tuesday after its board approved the acquisition of Patanjali Ayurved Ltd.'s entire non-food business for Rs 1,100 crore.

The non-food business of sister company Patanjali Ayurved includes haircare, skincare, dentalcare, and homecare, according to an exchange filing. The total acquisition amount will be paid in five tranches of 20%, 20%, 45%, 10%, and 5%, the filing said. The transaction falls under the related-party transaction category as Patanjali Foods is one of the promoters of Patanjali Ayurved.

As part of the deal, the company will also acquire Patanjali Ayurved's moveable assets, immovable properties, assumed liabilities, contracts, licenses, books, and records, the exchange filing said. This acquisition will likely increase the product portfolio of Patanjali Foods.

However, the Securities and Exchange Board of India must approve the acquisition.

The company has also entered into a license agreement with Patanjali Ayurved to obtain rights to use the latter's licensed intellectual properties, according to an exchange filing on Monday.