The board of directors of Marico has approved the restructuring of the company’s businesses, corporate entities and organisation effective April 1, 2013, to unlock value.
The restructuring will lead to the company’s skin care business being spun off into a separate company, while Marico’s Consumer Products Business in India (CPB) and the International Business Group (IBG) would be consolidated to be an FMCG company.
“We propose to create two separate companies through partitioning of the current Marico into an FMCG business company, which is Marico Ltd. (already in existence), and a Skin Care Solutions Business Company which will be Marico Kaya Enterprises Ltd (MaKE, to be formed) or any such other name..” the company said .
MaKE will house the Kaya business, through its subsidiaries Kaya Ltd and all Kaya entities overseas. The Kaya business will be formed as a 100 per cent subsidiary of Marico.
One fully paid-up equity share of Rs.10 each of MaKE will be issued and allotted at a premium of Rs.200 per share for every 50 fully paid-up equity shares of Re.1 each held in Marico.
All employees on the payroll of Marico and are deputed to Kaya will move to MaKE or one of its subsidiaries. Harsh Mariwala will continue to be the Chairman and Managing Director of Marico and Marico Kaya Enterprises Ltd.
As per the proposed organisational restructuring, Saugata Gupta, who heads the CPB will lead the overall FMCG business as CEO-Marico.
Ajay Pahwa, CEO-Kaya, has decided to leave the organisation effective April 1, 2013, to pursue an opportunity outside Marico. Vijay Subramaniam, who heads the IBG will take over as CEO-Kaya, effective April 1, 2013. He will be in charge of the Kaya business in India and overseas.