India's Sheela Foam to buy rival mattress maker Kurlon for $241 mln- ET Now (updated)

Sheela Foam

28/12/2022 09:40

(Adds details, background)
       BENGALURU, Dec 28 (Reuters) - Indian mattress maker
Sheela Foam Ltd  SHEF.NS  will soon acquire competitor Kurlon
for 20 billion rupees ($241.29 million), ET Now reported on
Wednesday, citing sources.
    Should the deal go through, Sheela Foam could command a
market share of 35-40%, Moneycontrol had reported last month,
quoting a person familiar with the planned deal.
        Sheela Foam and Kurlon did not immediately respond to
Reuters' requests for comment.
  
    Sheela Foam, which sells the "Sleepwell" brand of
mattresses, is the only listed mattress maker in the country. 
        The Ghaziabad-based company has a 25% market share in
the sector, according to a note by ICICI Securities. The
brokerage pegs India's modern mattresses sector at 175 billion
rupees.
  
        Sheela Foam shares rose as much as 5% to 1,338 rupees
following the report.
  
       News of the potential acquisition comes as Kurlon
Chairman and Managing Director Sudhakar Pai is looking to hand
over the reins, the Moneycontrol report added.
  
        It also comes at a time when other industry players like
Duroflex, Springwell and The Sleeping Co have raised money from
private equity firms over the past few years, according to
multiple media reports.
  
        Kurlon's annual consolidated net profit has declined
from 760.9 million rupees in fiscal year 2020 to 179.7 million
rupees in fiscal year 2022.
  
        Started in 1962 as Karnataka Coir Products Ltd, Kurlon
currently has nine plants and 72 branch and stock points across
India.
  
($1 = 82.8880 Indian rupees)
 (Reporting by Nandan Mandayam in Bengaluru; editing by
Uttaresh.V and Sohini Goswami)
 ((Nandan.Mandayam@thomsonreuters.com; Mobile: +91 9591011727;))