Patanjali's food retail business will be acquired by Ruchi Soya and changes its name

Ruchi Soya has agreed to purchase Patanjali Ayurved Limited (PALfood )'s retail business undertaking, which includes the manufacturing, packaging, labelling, and retail trading of certain food products, as well as manufacturing plants in Padartha, Haridwar, and Newasa, Maharashtra, subject to shareholder and other authority approval.

On a slump sale basis, the acquisition is valued at Rs 690 crore, with an estimated completion date of July 15, 2022. Following the acquisition, the name of Ruchi Soya would be changed to Patanjali Foods.

Ruchi Soya announced that its board of directors has resolved to change the company's name from "Ruchi Soya Industries Limited" to "Patanjali Foods Limited," pending legislative and regulatory clearance. Ruchi Soya's stock was up 3% to 1,116 in afternoon trading.

"The transaction will include the transfer of employees, assets (excluding Patanjali's brand, trademarks, designs, and copyrights), current assets (excluding debtors, vehicles, cash, and bank balance), contracts, licences and permits, distribution network, and customers related to Patanjali Ayurved's Food Retail Business Undertaking," the company said in a regulatory filing on Wednesday.

Ruchi Soya was acquired by Baba Ramdev's Patanjali through an insolvency process in 2019. On the application of Standard Chartered Bank and DBS Bank, the National Company Law Tribunal (NCLT) ordered the start of bankruptcy proceedings against Ruchi Soya in December 2017.

In April of this year, the edible oil giant launched a follow-on public offering (FPO) to meet market regulator Sebi's minimum public shareholding requirement of 25% in a listed business.