Hindustan Foods Ltd, a key supplier of packaged consumer items to the likes of Hindustan Unilever, Marico and Danone, said it has agreed to acquire sports-shoe manufacturing operations from SSIPL Retail Ltd for Rs 77 crore. The company already supplies shoes to some leading sports brands and the new acquisition will add around 3,500 employees to its headcount.
KNS Shoetech Private Limited, a wholly owned subsidiary of Hindustan Foods, entered into a Business Transfer Agreement to acquire SSIPL's manufacturing facilities at Bangran and Bhagani in Himachal Pradesh as well as Kundli in Haryana. The total outlay for the transaction exceeded Rs 100 crore.
The acquired factories are state-of-the-art facilities catering to leading sports and footwear brands including Puma, Reebok, Asics and Sketchers. The deal will help establish KNS Shoetech as a premier contract manufacturer for brands looking to expand production in India. KNS Shoetech already has existing relationships with some of these brands for shoe manufacturing.
"SSIPL is one of the pioneers of the sector having started manufacturing sports shoes and sneakers in 1995," said Himmaj Soni, Head of the Sports Shoes Division at Hindustan Foods. "With this strong foundation, we are confident that we should be able to leverage the massive opportunity that is unfolding in the sector."
Hindustan Foods has been diversifying beyond its core FMCG business in recent years to expand into new categories such as sports shoes. In December, the company announced its entry into footwear manufacturing.
"It is a matter of pride to welcome the more than 3,500 strong team of SSIPL to KNS," said Sameer Kothari, Managing Director of Hindustan Foods. "On the back of the Baddi acquisition and this one, we are confident that HFL should be able to meet the goal it had set for FY2025."
The acquisition is expected to close in the coming months subject to customary closing conditions. Hindustan Foods said it will continue to explore more opportunities in contract manufacturing as it aims to become a one-stop-shop for brands looking to outsource production. The company's foray into sports shoes complements its existing capabilities in FMCG contract manufacturing.