Furniture rental startup Furlenco sells 35% stake for USD 36.5 million in Indian market.
Acquisition Details
Sheela Foam, the manufacturer of the popular mattress brand Sleepwell, has announced that it will be acquiring a 35% stake in Bengaluru-based furniture startup Furlenco. This move is aimed at expanding Sheela Foam’s presence in India’s growing mattress market and entering the branded furniture market.
Deal Value
The acquisition deal values Furlenco at approximately $104.3 million, which represents about 8.5 times its revenue for the financial year ending March this year. The publicly listed firm has proposed to pay $36.5 million for the stake in Furlenco.
Furlenco’s Revenue and Operations
Furlenco operates a furniture and appliance rental service across over a dozen cities in India. According to Sheela Foam, the platform generated revenue of $18.5 million during the financial year ending March this year. The startup has raised over $225 million in equity and debt funding prior to this deal.
Impact on Indian Market
The acquisition is expected to help Sheela Foam enter the fast-growing branded furniture market in India. With Furlenco’s presence, Sheela Foam will be able to tap into the expanding demand for home furniture and appliances in the country.
Separate Acquisition by Sheela Foam
In a separate development, Sheela Foam has announced that it is acquiring a 94.66% stake in Kurlon Enterprises, the manufacturer of Kurlon mattresses, for $262 million. This acquisition is aimed at strengthening Sheela Foam’s presence in the Indian mattress market.
Market Expansion Strategy
The acquisition of Furlenco and Kurlon Enterprises reflects Sheela Foam’s aggressive expansion strategy in India’s mattress and furniture markets. With these deals, the company aims to strengthen its position as a leading player in the country’s home furnishings industry.
Furlenco’s Future Plans
While Furlenco has not commented on the acquisition directly, sources indicate that the startup plans to continue operating independently after the deal is finalized. The company will likely leverage Sheela Foam’s resources and expertise to expand its business and reach new markets.
Industry Trends
The growth of India’s home furnishings market presents a significant opportunity for companies like Furlenco and Sheela Foam to tap into the demand for branded furniture and mattresses. With increasing disposable incomes and changing lifestyles, consumers are seeking high-quality products that meet their needs.
Conclusion
Sheela Foam’s acquisition of Furlenco marks an important milestone in its expansion strategy in India. The deal reflects the company’s commitment to strengthening its presence in the country’s mattress market and entering the branded furniture market. With these moves, Sheela Foam aims to capitalize on the growth potential of India’s home furnishings industry.
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