Kochi-based publicly-listed consumer electrical and electronics company V-Guard Industries on Friday announced that it has signed definitive agreements for acquiring 100% stake in Sunflame Enterprises (SEPL) for a consideration of Rs 660 crore. The deal is on a cash-free, debt-free basis, subject to closing adjustments and the transaction is expected to close by mid of January 2023.
The acquisition is in line with V-Guard’s strategy to become a significant player in the domestic kitchen appliances segment. The Sunflame brand has a pan India presence with a strong brand recall. SEPL’s wide portfolio, product development capabilities and the recently established state-of-the-art integrated manufacturing facility provide the perfect opportunity for V-Guard to scale up its kitchen appliances business while also unlocking synergy benefits. The transaction would be funded through a mix of internal accruals and debt.
“The proposed acquisition is a key milestone in V-Guard’s journey to have deeper engagement with its consumers by providing thoughtful products and experiences. Sunflame is an iconic brand etched in the memories of Indian households and is expected to provide significant thrust to V-Guard’s plans to become a leading Indian kitchen appliances player,” Mithun Chittilappilly, MD, V-Guard, said.
According V-Guard, SEPL acquisition is a synergistic fit and offers multiple levers for unlocking significant synergies in areas like geography, product portfolio and channels. It believes that this deal is value accretive for the shareholders of V-Guard and would catapult the company into league of frontline kitchen appliances players in the country.”
K L Verma, MD, SEPL said, “Having started this journey in 1984, we have come a long way since then. V-Guard, a name synonymous with trust, is the right organisation to take this legacy forward. We are confident that the Sunflame brand would scale even greater heights with V-Guard.” Deloitte Touche Tohmatsu India, Cyril Amarchand Mangaldas and Singhi Advisors provided financial, legal and transaction advisory services respectively to V-Guard.
Faridabad-based SEPL is one of the leading players in the kitchen appliances space in India. With a history of nearly four decades, SEPL offers a wide product portfolio including cooktops, chimneys, pressure cooker, mixer grinder and small kitchen appliances that caters to every consumer segment. SEPL recorded a revenue of Rs 349.8 crore in FY22.
V-Guard Industries recorded revenues of Rs 3,498 crore in FY 2022 and is present across the country with 32 branches and with over 50,000 channel partners. Founded in 1977 by Kochouseph Chittilapilly to manufacture and market voltage stabilisers, it has now become a force to reckon with in the Indian electric and electronic goods panorama. The company, in the last 45 years, has established a strong brand name and aggressively diversified into a multi-product company with a portfolio including voltage stabilisers, inverter & inverter batteries, electric water heaters, solar water heaters, pumps & motors, domestic switchgears, wires & cables, fans, modular switches, air coolers and kitchen appliances.