Sheela Foam Limited, a leader in Home Comfort products (foam-based) and the largest Polyurethane (PU) Foam manufacturer, announced two simultaneous deals, with controlling stake in Kurlon Enterprises Limited (flagship brand Kurl-on — Mattress of India) and a stake in Furlenco furniture (online furniture brand owned and operated by “House of Kieraya Private Limited” or “HOK”).
SFL is acquiring 94.66% shareholding in KEL at an equity valuation of Rs. 2150 crores (cost of acquiring 94.66% around Rs. 2035 crs); subject to customary working capital, debt and debt like items and other adjustments, if any. The indicative time period for the completion of the acquisition is by or before 30th November 2023, the statement said.
SFL is also investing in 35% shareholding in HOK-Furlenco for an equity valuation of Rs. 857.14 crs (cost of investing in 35% stake is Rs. 300 crs); subject to customary working capital, debt and debt like items and adjustments, if any. The indicative time period for the completion of the investment will be by or before 30th August 2023.
The Kurlon deal gives Sheela Foam an undisputed leadership across major product categories with its flagship brand Sleepwell’s strength in foam (consistent quality and innovation); and acquired brand Kurl-on’s strength in rubberised coir; wherein both these companies are leaders in their respective product segments. Sheela Foam will now command a combined market share of around 21% in the modern mattress market in India, according to the statement.
Rahul Gautam, Chairman & Managing Director, Sheela Foam Ltd., said, “With the coming together of Kurl On, Sheela Foam will further cement its leadership position in the modern mattress market. The investment of Furlenco would give it a very strong entry into the branded furniture market, and a much bigger market than its existing market. With these two within its fold, Sheela Foam is at an inflexion point, where opportunities created by inorganic activity would greatly strengthen the business model and propel a higher level of organic growth.” The diverse products, integrated manufacturing, distribution synergies, pan-India footprint & Digital-First play will help to tap new-age customers. And the Sheela Foam family will get bigger and better as employees and business partners of Kurl-On & Furlenco continue in their role and responsibility and add to the overall expertise of the existing team.”
SFL has had a strong track record of acquisitions and also turning them around. Sheela Foam had acquired Joyce Foam in Australia with 5 manufacturing plants in 2003 and Comfort Technologies in Spain in 2019. This puts it in a very suitable position to drive advantage of the new acquisitions.”
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