Crompton Greaves to scoop up 55% stake in Butterfly Gandhimathi

The total agreement includes trademarks, an open offer, 55% share which will be a combined Rs 2000 crore and is to be financed by a mix of internal collection and debt.

The leading manufacturer of consumer products Crompton Greaves announced that it has signed agreements with Butterfly Gandhimathi Appliances on 22nd February for a 55% stake which evaluates at Rs 1,379.68 crore. Crompton wants to enter into the small-scale domestic appliances sector.

It has been decided that the company will lock the price at Rs 1,403.00/share and slated to buy some trademarks of Butterfly for Rs 30.38 crore.

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That’s not all, Crompton has plans to launch an open offer for 26% of the group involved in manufacturing, marketing and distribution of domestic electrical goods at a nominal Rs 1,433.90/share. This will club the open offer at Rs 666.57 crore.

The total agreement includes trademarks, an open offer, 55% share which will be a combined Rs 2000 crores and is to be financed by a mix of internal collection and debt.

MD of Crompton, Shantanu Khosla said that “Crompton had been planning to enter the small domestic appliances sector and now it’s realizing its plan and this strategic move is to strengthen the domestic appliances sector and expand its product list.”

Butterfly has been a part of South Indians for over 50 years now. It has an exhaustive brand strategy and penetration and this will help in laying a foundation to further the mixer-grinder market. Plans are to reach every kitchen in domestic circles.

Chairman of Butterfly VM Lakshminarayan said that “this association is a perfect fit to make Butterfly a pan-India brand. Crompton was a perfect fit and there is massive scope for us to complement that.”