Crompton Greaves Consumer said that it signed a definitive agreement on February 22 to obtain 55% of the shares in Gandhimathi butterfly equipment for 1,379.68 crore as a consumer prisoner company that seemed to raise his game in small domestic equipment.
The company, which will make an agreement on Rs 1,403.00 per share, will also buy a particular butterfly trademark of the promoter group entity for Rs 30.38 Crore.
In addition, Crompton will also launch a mandatory open offer for 26% of companies engaged in manufacturing, marketing and distribution of kitchen and small household appliances, with a price of 1,433.90 per share. This price offers open at Rs 666.57 Crore.
The total agreement, consisting of 55% of the shares, open offers and trademarks, will be worth Rs 2,076.63 Crore and is expected to be financed through internal and debt accrual mixtures.
It came after MoneyControl first reported that Crompton was set to swoop the company.
Crompton said this acquisition was a transformational step towards its long-term strategic goal into a leading Pan-Indian player in small domestic equipment. As one of the few producers integrated in this space, butterfly offers a direct scale in kitchen equipment with a diverse portfolio, he added.
Shantanu Khosla, Managing Director Crompton, said, “Crompton in a long-term strategic plan put a road map to” extend the core product portfolio “. The main step in this roadmap is to strengthen the category of small household appliances. Butterflies, a brand with vintage from More than five decades, has developed into a strong brand in South India. Channels and proven butterfly brands and brand strategies will form a base for a stronger small domestic equipment business led by a mixer grinder. This sets a platform for a full kitchen drama, which is will allow connected to be stronger with every home. “
VM Lakshminarayanan, Chairperson, Butterflies, said, “This step will provide an opportunity for the butterfly brand to reach the reach of Pan-India. Crompton is a synergistic fit and there is great potential to complete each other.”
Speaking to CNBC-TV18, Managing Director of Butterfly, VM Seshadri, said that he was happy with Crompton’s offer, adding, “After the agreement, the current promoter would not be classified as a promoter, and would not be part of the board.” They will accommodate less than 10% of the shares and have signed a non-competent clause with Crompton.
Investment Banking Box acts as a financial advisor and manager for open offers for Crompton, and Khaitan & Co acts as a legal counsel for Crompton.
