afaqs! news bureau

Mamaearth's parent company to merge two subsidiaries to avoid costs duplication: Report

The board approved the merger of Just4Kids and Fusion Cosmecutics to enhance efficiency, eliminate structured layers, and improve focus.

According to a report on Zee, Honasa Consumer, the parent company of the D2C cosmetics brand, Mamaearth, announced on Friday that its board has given the green light for the merger of its subsidiaries Fusion Cosmeceutics and Just4Kids with the company.

Fusion Cosmeceutics focuses on developing and selling skin care products, while Just4Kids Services operates and maintains a multilingual content platform.

"The Board of Directors of the Company, at its meeting held today i.E. On April 19, 2024, considered and approved the scheme of amalgamation...Providing for the amalgamation of wholly owned subsidiaries of Honasa Consumer namely, Fusion Cosmeceutics (Transferor Company-1) and Just4Kids Services(Transferor Company-2) into and with Honasa Consumer," the filing said.

Fusion Cosmeceutics generated independent revenue of Rs 76.61 crore while Just4Kids brought in Rs 4.05 crore in revenue as of December 31, 2023.

"The Scheme is subject to necessary statutory and regulatory approvals under applicable laws, including approval of the Hon'ble National Company Law Tribunal, New Delhi Bench, New Delhi and the Hon'ble National Company Law Tribunal, Chandigarh Bench, Chandigarh," the filing said.

The merger will assist Honasa in avoiding redundant costs and increasing financial efficiencies through a holding structure.

"The resultant operations are expected to be substantially cost-efficient which would result in maximising overall shareholder value and will improve the competitive position of the combined entity. Eliminate layered structures and reduce managerial overlap," the filing said.

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