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Dabur acquires 51% stake in Badshah Masala for Rs 587.52 crore

Dabur today announced that it has signed definitive transaction agreements to acquire 51 per cent shareholding of Badshah Masala.

Dabur acquires 51% stake in Badshah Masala for Rs 587.52 crore
Dabur announced that it has acquired 51 per cent shareholding of Badshah Masala. Image: Bloomberg

Dabur announced its entry into the Rs 25,000 crore spices and seasoning category by acquiring a majority stake in Badshah Masala Private Limited. Dabur today announced that it has signed definitive transaction agreements to acquire 51 per cent shareholding of Badshah Masala which manufactures, markets and exports ground spices, blended spices and seasonings. This acquisition is in line with Dabur’s strategic intent to expand its foods business to Rs 500 crore in 3 years and expand into new adjacent categories, the company said in a statement. “This acquisition will accelerate our growth strategy as we continue to build our foods business. We intend to leverage our international market presence to grow this business globally,” said Mohit Burman, Chairman, Dabur India Ltd.

Dabur is making this acquisition for Rs 587.52 crore, less proportionate debt as on the closing date, with the Badshah enterprise being valued at Rs 1,152 crore. This translates to a revenue multiple of around 4.5x and EBIDTA multiple of around 19.6x of FY2022-23 Estimated financials. “The transaction is expected to be Cash EPS neutral in the first year and accretive thereafter. The acquisition is expected to be completed within this fiscal. As per our agreement, we will acquire the balance 49 per cent shareholding after 5 years,” said PD Narang, Group Director, Dabur India Ltd. 

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Dabur India’s FMCG portfolio includes, Dabur Chyawanprash, Dabur Honey, Dabur Honitus, Dabur PudinHara and Dabur Lal Tail in the Healthcare space; Dabur Amla, Dabur Red Paste and Vatika in the Personal Care category; and Real in the Food & beverages space. “Dabur has an existing foods portfolio and views ground and blended spices as a good addition to this portfolio. Badshah portfolio will gain from Dabur’s extensive distribution reach,” said Mohit Malhotra, Chief Executive Officer, Dabur India Ltd. During FY 2021-22, Dabur recorded consolidated revenue from operations of Rs 10,889 crore and consolidated profit after tax of Rs 1,742 crore.

Meanwhile, Hemant Jhaveri, Managing Director, Badshah Masala Private Limited, said, “This transaction will enable us to accelerate our growth by adding our products to Dabur’s broad portfolio to meet the needs of consumers across geographies.”

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First published on: 26-10-2022 at 16:26 IST