GCPL acquires Raymond’s FMCG business for INR 2,825 crore to enter deodorants and sexual wellness categories
To get a foothold in the deodorants and sexual health categories in India, Godrej Consumer Products Limited (GCPL) would pay 2,825 crore to purchase Raymond Consumer Care Limited’s (RCCL) FMCG business. Through a slump sale, the Raymond’s FMCG Company as well as the trademarks of Park Avenue (for the FMCG category), KS, KamaSutra, and Premium are being transferred to GCPL. “The acquisition enables us to add underserved markets with a long growth runway to our company portfolio and growth plan, according to Sudhir Sitapati, Managing Director and CEO of GCPL. With products like Park Avenue and KamaSutra, Raymond is a major force in the deodorants and sexual wellness Industries. Given the low per capita expenditure, these categories could experience double-digit multi-decade growth in India compared to similar emerging markets.”
To create a listed entity, Raymond stated today that its Lifestyle business would be demerge rated to RCCL. The Suiting Business with Manufacturing Facilities, B2C Shirting and MTM Businesses, Branded Apparel including Garmenting Business with Manufacturing Facilities, and B2B Shirting Business with Manufacturing Facilities make up the Lifestyle Business. Additionally, RCCL will continue contract production in Aurangabad, Maharashtra, for both domestic and foreign markets while keeping its condom manufacturing facilities. Raymond Ltd. would primarily be a public real estate corporation with investments in Engineering and the Denim Industry after the Lifestyle Business is demerged.
The Lifestyle Business will be able to become net debt free and an independently listed corporation thanks to the decision to demerge it from Raymond Limited. According to the swap ratio proposed by Independent values KPMG and BDO and supported by a fairness opinion provided by ICICI Securities Ltd. and approved by the Board of Directors of Raymond Limited, the Lifestyle Business that is currently under RCCL will be listed in the future, and each shareholder of Raymond Limited will receive 4 shares of RCCL for every 5 shares held.
