Reliance Retail’s Arm Successfully Acquires Majority Stake in Lotus Chocolate
Written by Sanjay Kumar
Reliance Consumer Products (RCPL), the fast-moving consumer goods arm of Reliance Retail Ventures (RRVL), has successfully completed the acquisition of a 51 percent controlling stake in Lotus Chocolate Company. The acquisition was valued at a total consideration of Rs 74 crore. This significant development was announced in a release by Reliance Retail Ventures on Thursday (May 26). Additionally, RCPL has subscribed to non-cumulative redeemable preference shares of Lotus for a total consideration of Rs 25 crore.
RCPL has also finalized the acquisition of equity shares through an open offer, following the regulations set by the Securities and Exchange Board of India (SEBI) regarding takeovers. As of Wednesday (May 24), RCPL has assumed sole control of LOTUS. These recent actions have solidified RCPL’s position in the company.
According to the release, Reliance Retail Ventures reported a consolidated turnover of Rs 260,364 crore and a net profit of Rs 9,181 crore for the fiscal year that ended on March 31, 2023. RRVL, which is a subsidiary of Reliance Industries Ltd, serves as the holding company for all retail businesses under the RIL group.
The release further highlights that RRVL, along with its subsidiaries and affiliates, operates an integrated omni-channel network consisting of 18,040 stores and digital commerce platforms catering to various consumer categories such as grocery, consumer electronics, fashion and lifestyle, and pharma consumption. Through its New Commerce initiative, RRVL has established partnerships with over three million merchants.
Reliance Consumer Products, the FMCG subsidiary of RRVL, aims to offer a diverse range of products under a versatile brand portfolio, meeting the everyday needs of millions of Indians.
Lotus, a listed company on the BSE stock exchange, holds a prominent position as one of India’s leading manufacturers of chocolates, cocoa products, and cocoa derivatives.
In December of the previous year, Reliance Retail had announced RCPL’s intention to acquire a 51 percent controlling stake in Lotus Chocolate Company Limited and make an open offer to acquire up to 26 percent of the stake. RCPL’s acquisition involved purchasing 65,48,935 equity shares of LOTUS, representing 51 percent of the company’s paid-up equity share capital, from the existing promoters and promoter group of Lotus. The price per share was set at Rs. 113.00, amounting to a total of Rs 74 crore.
Furthermore, RCPL and certain promoter group entities of LOTUS committed to subscribing to 5,07,93,200 non-cumulative redeemable preference shares with a face value of Rs 10 each at par. These measures reinforced the partnership between RCPL and LOTUS, marking an important milestone in their business collaboration.
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