V-Guard Industries to acquire Sunflame Enterprises for Rs 660 crore

Deal likely to close by mid-Jan 2023, will be funded by mix of internal accruals and debt

Kerala-based V-Guard Industries (V-Guard) on Friday announced that it has signed definitive agreements for acquiring 100 per cent stake in Sunflame Enterprises (SEPL) for a consideration of Rs 660 crore, on a cash-free, debt-free basis, subject to closing adjustments. 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 recall. SEPL’s wide portfolio, product development capabilities and a 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 company said in a statement. The deal 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. We appreciate the trust reposed by SEPL’s Promoter family in us to take the Sunflame brand to greater heights,”  said Mithun Chittilappilly, Managing Director, V-Guard.

“We are proud of the Sunflame legacy, having won and retained the trust of our customers and partners for nearly four decades. Having started this journey in 1984, we have come a long way since then. V-Guard, a name synonymous with trust, is the right organization to take this legacy forward. We are confident that the Sunflame brand would scale even greater heights with V-Guard,” said K  L Verma, Managing Director, SEPL. Deloitte Touche Tohmatsu India, Cyril Amarchand Mangaldas and Singhi Advisors provided financial, legal and transaction advisory services respectively to V-Guard.

“SEPL acquisition is a synergistic fit, and offers multiple levers for unlocking significant synergies in areas like geography, product portfolio and channels. We believe that this deal is value accretive for the shareholders of V-Guard and would catapult the Company into the league of frontline Kitchen Appliances players in the country,” said V Ramachandran, chief operating officer, V-Guard.