“Our company has acquired biscuits, cookies, rusk and other associated bakery product business from one of our promoter, i.e., Patanjali Natural Biscuits Private Limited, including the manufacturing unit at Bhagwanpur (Haridwar) on a going concern basis through a business transfer agreement,” the company said.
Ruchi Soya said that it has acquired the biscuits business from Patanjali for Rs 60 crore and under the agreement, it is required to pay the balance 75 per cent of the consideration for acquiring the business to its promoters within three months from the sale that took place in May.
Further, Ruchi Soya will pay a royalty of 0.5 per cent of quarterly sales to Patanjali for selling the biscuits under the ‘Patanjali’ brand.
“Our company has acquired the noodles and breakfast cereal business from Patanjali Ayurved Limited through an assignment agreement dated June 2, 2021,” Ruchi Soya said.
Under the agreement, Ruchi Soya will pay Patanjali a royalty of 0.5 per cent of quarterly net sales for using the brand ‘Patanjali’ for the noodles and breakfast cereals business.
Ruchi Soya said that it has also ventured into the lucrative nutraceuticals business ahead of the public offering. “We anticipate that the growth potential in the health and wellness industry will lead to increased competition both from established players as well as from new entrants in the industry,” the company said.
Ruchi Soya is aiming to raise Rs 4,300 crore from a follow-on public offer. The company plans to use Rs 2,663 crore for repayment of the company’s borrowings and Rs 593.4 crore for working capital. The remainder of the proceeds will be used by the company for general corporate purposes.