Media reports are claiming Indian FMCG giant Patanjali Ayurved’s long-running attempt to take over local edible oil business Ruchi Soya could be nearing completion.
It has been widely reported in the Indian media the country’s National Company Law Tribunal (NCLT) has approved Patanjlai’s bid, believed to be INR43.5bn (US$630m).
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In May, debt-laden Ruchi confirmed to the country’s stock exchange that the vast majority of its lenders had backed a takeover bid from Patanjali.
Now, if reports are correct, the deal can go through, although the NCLT has apparently asked for further details of how the deal is to be funded to be supplied before its next hearing date on 1 August.
India’s Business Day title reported that the resolution plan will see Patanjali infuse the acquisition amount into a special purpose vehicle and this would later be merged with Ruchi.
It said the bulk of the money will be used to pay off creditors with the surplus being used for improvising operations at Ruchi.
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By GlobalDataRuchi Soya entered a corporate insolvency resolution process in late 2017 leading to interest from a number of potential buyers.
Patanjali was initially outbid in its attempt to buy it by local cooking oil business Adani Wilmar, which later withdrew its offer after growing frustrated by delays in the insolvency process.
Ruchi has a number of manufacturing plants and owns brands including Nutrela, Mahakosh, Sunrich, Ruchi Star and Ruchi Gold.
just-food has contacted Ruchi Soya and Patanjali to get confirmation of this story.
