Sheela Foam Ltd., the company behind the Sleepwell brand, announced today its decision to increase its stake in House of Kieraya Limited, known for its furniture brand Furlenco. The company’s board approved a subsequent investment in the target company, which operates primarily in the online furniture segment across major Indian cities.
The shares of Sheela Foam Ltd. were trading at ₹899.05 up by ₹26.50 or 3.04 per cent on the NSE today at 2.55 pm.
Sheela Foam plans to subscribe to up to 50,45,540 equity shares in a rights issue and exercise 56,00,995 partly paid-up subscribed warrants. Additionally, the company intends to purchase up to 3,50,000 shares from existing shareholders. The total investment is expected to amount to approximately ₹107 crores, increasing Sheela Foam’s stake in House of Kieraya to about 10.50 per cent.
The transaction, characterized as a related party transaction conducted at arm’s length, is set to be completed by October 14, 2024. House of Kieraya, founded in 2012, reported revenues of ₹152 crores in FY’24. This move aligns with Sheela Foam’s strategy to strengthen its position in the furniture market, particularly in the growing online segment.