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Sheela Foam to buy Kurlon Enterprise for Rs 3,250 crore
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    Sheela Foam to buy Kurlon Enterprise for Rs 3,250 crore

    21 July 2023

    Sheela Foam Ltd will fully acquire rival Kurlon Enterprise Ltd, buying 100 percent of the company in two tranches for a cash consideration of Rs 3,250 crore, according to a person familiar with the deal. The deal is expected to be concluded within a couple of months.

    Acquiring Kurlon Enterprise, maker of the Kurl-on brand of mattresses, will help Sheela Foam, known for the Sleepwell brand, nearly double its market share. Moneycontrol had earlier reported that if this deal materialises, Sheela Foam’s market share in India’s organised mattress segment could increase to 35-40 percent from 20-25 percent.

    Sheela Foam’s flagship brands include Sleepwell mattresses, Feather Foam, a pure PU Foam, and Lamiflex, a polyester foam for lamination.
    “Sheela Foam has a strong presence in the North and West while Kurlon is in the South And East,” the person added. The deal will also lead to cost benefits and synergies, he added.

    Around Rs 900 crore is expected to be added to the listed company’s topline at the consolidated level. Moreover, as a result of this deal, Sheela Foam will be able to source more raw material — TDI (Toluene Di-Isocyanate) — at lower rates.
    The mattress market in India consists of numerous branded and non-branded companies. Only 40 percent of the overall Indian modern mattress market comprises branded players. There are 25 players in the branded market with Sleepwell and Kurlon holding dominant shares.

    The mattress market was reportedly worth around $1.7 billion in India as of FY19, and is expected to more than double to $2.8 billion by FY24. The share of the organised, branded mattress industry, which stood at 29 percent of the market in FY14, grew to 35 percent by FY19, and is seen touching 40 percent by FY24.

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