Kurlon Enterprises (KEL) in engaged in the manufacturing and marketing of various foam based and Coir based home comfort products across the “Sit and Sleep” solution categories such as mattress, furniture cushions, pillows and coverings. Its turnover for financial year 2021-2022 was Rs 808.80 crore.

Sheela Foam being the leader in northern and western India, whereas KEL is having a higher market share in southern and eastern region of India, the Kurlon Enterprises' (KEL) acquisition will help Sheela Foam to diversify customer base and extend to a pan India footprint.

This consolidation would provide SFL a robust distribution network; and production efficiencies and cost savings.

SFL is also investing in 35% shareholding in HOK-Furlenco for an equity valuation of Rs 857.14 crore (cost of investing in 35% stake is Rs 300 crore); subject to customary working capital, debt and debt like items and adjustments, if any. The indicative time period for the completion of the investment will be by or before 30th August 2023.

Furlenco is owned by the House of Kieraya. It is one of the largest and fastest growing furniture rental companies in India. The company also offers sale of new and refurbished furniture under its Furlenco & Prava brands. Its revenue from operations for financial year 2022-2023 was Rs 152 crore.

The Furlenco deal will help Sheela Foam to enter the fast-growing branded furniture and furniture rental market, and an opportunity to further diversify its presence even in the furniture sales market and become a full portfolio company in the segment.

Sleepwell & Kurl-on exclusive stores may be made available with Furlenco furniture offerings. With the world's largest furniture & appliances refurbishment facilities, Sheela Foam-Furlenco can now offer Refurbishment as a Service (RaaS) for furniture. It will also benefit from Furlenco's Digital-First, Direct-to-Customer and e-commerce capabilities; as well as Furlenco's design capabilities.

Rahul Gautam, chairman & managing director, Sheela Foam, said, “With these two within its fold, Sheela Foam is at an inflexion point, where opportunities created by inorganic activity would greatly strengthen the business model and propel a higher level of organic growth. The diverse products, integrated manufacturing, distribution synergies, pan-India footprint & Digital-First play will help to tap new-age customers.

Sheela Foam had acquired Joyce Foam in Australia with 5 manufacturing plants in 2003 and Comfort Technologies in Spain in 2019. This puts it in a very suitable position to drive advantage of the new acquisitions.”

Sheela Foam sells foam, coir and spring mattresses under the Sleepwell brand and non-mattress foam products under the Feather Foam brand.

The company had reported 7.1% fall in consolidated net profit to Rs 45.8 crore on a 1.1% fall in revenue from operations to Rs 729 crore in Q4 FY23 over Q4 FY22.