Fragrance maker SH Kelkar and Company Ltd announced on Friday (March 13) that its board has approved the sale of its entire 17% equity stake in CFF Keva Italy SpA to Keva Italy Srl, a wholly-owned subsidiary of Keva Europe BV. According to reports from CNBC TV18 and HomeStocksNews, the transaction is scheduled for completion by September 30, 2026, with the sale consideration expected to be up to €12.5 million, approximately ₹112.5 crore. The deal aims to streamline the Keva Group's European structure by consolidating CFF Keva Italy under Keva Italy Srl, making CFF a wholly-owned subsidiary of Keva Italy, and in turn of Keva Europe BV and SH Kelkar.
The divestment will significantly impact SH Kelkar's financial metrics, as reported by CNBC TV18 and HomeStocksNews. CFF's revenue from operations of ₹358.04 crore for FY25 contributed 16.86% to SH Kelkar's consolidated revenue, while its turnover of ₹358.03 crore accounted for 16.95% of the company's consolidated turnover. The subsidiary's total income of ₹359.40 crore represented 16.74% of consolidated total income, and its net worth of ₹94.35 crore contributed 7.42% to the consolidated net worth of SH Kelkar. This restructuring simplifies SH Kelkar's ownership in Europe, enhancing operational clarity and potentially centralizing management oversight for its European fragrance operations.
The transaction aims to streamline the Keva Group's European structure, ensuring all European subsidiaries are fully owned through Keva Europe BV. As reported by CNBC TV18 and HomeStocksNews, following the sale, Keva Italy's stake in CFF will rise from 83% to 100%, making CFF a wholly-owned subsidiary of Keva Italy, and in turn of Keva Europe BV and SH Kelkar. Keva Italy Srl, incorporated in November 2019 as part of Keva's international strategy, is not part of the promoter or promoter group, though the transaction qualifies as a related-party deal under SEBI regulations. This consolidation may lead to more integrated management and strategic decision-making for CFF Keva Italy, supporting the Keva Group's ongoing strategy to streamline European operations.
Shares of SH Kelkar and Company Ltd ended at ₹121.20, down by ₹8.05, or 6.23%, on the BSE on March 13, according to CNBC TV18. The company confirmed that the transaction falls outside any slump sale or scheme of arrangement, with the agreement set to be executed and completed on or before September 30, 2026. Investors will monitor the sales agreement's execution and look for updates on integration and the strategic benefits derived from this consolidation. While specific risks for this transaction were not detailed, general concerns for SH Kelkar include potential financial strain from recent acquisitions if integration and synergy realization are slow, and risks from significant debt-funded capital expenditure that could impact the balance sheet.
