Royal Philips Electronics, with business interests in healthcare, consumer electronics, appliances and lighting segments, has agreed to acquire the Chennai-based appliances brand Preethi, leader with over 25 per cent share in the approximately 48-lakh-unit-a-year mixer-grinder market in India.
The acquisition, for an undisclosed consideration as of now, is to be done through a special purpose vehicle floated by the company.
With almost 40 per cent of its consumer lifestyle sector's sales already derived from emerging markets, the acquisition of Preethi demonstrates Philips' commitment to drive local innovation, including further expanding its industrial and commercial footprint in emerging markets, says a release from Philips.
“To capture growth in kitchen appliances, we need to intimately understand local consumer needs and deliver the right solutions,” Mr Pieter Nota, Chief Executive Officer of Philips Consumer Lifestyle, is quoted as saying.
“By building on Preethi's unique local knowledge, heritage of quality, and substantial distributor and dealer network, we are well positioned to drive growth in one of the world's most dynamic kitchen appliance markets,” the release adds.
According to Mr T.T. Varadarajan, Chairman and Managing Director of Maya Appliances (owner of the Preethi brand), who will continue to spearhead the new entity, “The combined strength of our two organisations will benefit both our customers and employees.”
Upon closing of this transaction in the next few months, Preethi will become part of the Domestic Appliances Business Group within Philips' Consumer Lifestyle sector.
As of now, though Philips too has a play in the mixer-grinder segment in India, it has to compete with brands such as Panasonic, Butterfly, Maharaja Whiteline, and Kenstar for the remaining share of the market.