Consumer durables firm Bajaj Electricals has said that it will acquire non-stick cookware company Nirlep Appliances Pvt. Ltd for Rs 42.5 crore ($6.28 million) in a cash deal.
The deal value is subject to adjustments of any additional liabilities for the period before the transaction, Bajaj Electricals said in a stock market disclosure.
The acquisition is expected to provide Bajaj Electricals a strong foothold in the non-electric kitchen appliances category and access to a quality manufacturing setup in western India, said Gaurav Agarwal, director at investment bank Singhi Advisors, which was the sole financial advisor for the transaction.
Nirlep Appliances was founded in 1968 by Mukund Bhogale. The company manufactures non-stick cookware, hard anodised cookware, gas stoves, pressure cookers, enameled cookware, and professional cookware. It claims to be the first Indian company to export professional non-stick cookware to Europe, and the first to manufacture induction compatible non-stick cookware in the country.
Nirlep’s turnover has seen a decline in the past three years, Bajaj Electricals said. Total income slid to Rs 47 crore (provisional) in the last fiscal ended 31 March 2018 from Rs 54 crore and Rs 79 crore in the financial years 2016-17 and 2015-16, respectively.
Vaish Associates, a partner firm of the Andersen Global network, was the exclusive legal advisor to Nirlep for the transaction.
Bajaj Electricals, which is part of the Bajaj Group, has businesses spread across consumer products (appliances, fans, lighting), exports, luminaires and engineering, procurement, and construction (EPC).
The company’s turnover jumped to Rs 4,716.39 crore in the last fiscal ended 31 March 2018 from Rs 4,298.26 crore in the previous financial year, according to stock exchange data. Its net profit, however, fell to Rs 8.36 crore in 2017-18 from Rs 10.76 crore in 2016-17.
Bajaj Electricals’ share price on the National Stock Exchange stood at Rs 536.30 after trading ended on Friday, 0.52% higher than the previous close.
In a recent deal in the space, home appliances manufacturer Whirlpool of India Ltd said earlier this month that it would acquire 49% stake in kitchen equipment maker Elica PB India Pvt. Ltd for around Rs 162 crore ($24.2 million).