This acquisition is in line with the company’s strategic intent to expand its foods business to Rs 500 crore in three years and expand into new adjacent categories. This also marks Dabur’s entry into the over Rs 25,000-crore branded spices and seasoning market in India.
Announcing the acquisition, Dabur India Chairman Mohit Burman said, “The Indian spices and seasoning category is a large and attractive market. Badshah Masala is one of the key players in this space. Our investment in Badshah Masala will help expand this business and continue to provide unmatched quality products.”
He said that this acquisition would accelerate our growth strategy as we continue to build our foods business and the company intends to leverage our international market presence to grow this business globally.
Dabur is acquiring 51 per cent stake in Badshah for Rs 587.52 crore, less proportionate debt as on the closing date, with the Badshah enterprise being valued at Rs 1,152 crore. This translates to a revenue multiple of around 4.5x and Ebidta multiple of around 19.6x of 2022-23 Estimated financials.
“The transaction is expected to be Cash EPS (earning per share) neutral in the first year and accretive thereafter. The acquisition is expected to be completed within this fiscal. As per our agreement, we will acquire the balance 49 per cent shareholding after five years,” Dabur India Group Director PD Narang said.