Good Glamm scraps plan to buy Raymond’s consumer biz

The group was reportedly in talks to buy the consumer care business, which houses the Park Avenue and KamaSutra brands, in a cash-and-stock deal worth ₹2,500- ₹2,800 crore.

When contacted, Darpan Sanghvi, co-founder and chief executive, Good Glamm, said the company has called off a large transaction. He declined to elaborate citing confidentiality clauses but said that there were disagreements over valuation.

“The market has changed since we started engaging with the target company late last year and we have to price that in the valuations,” he said.

A spokesperson for Raymond did not respond to queries.

With the proposed deal being called off, Good Glamm has also decided not to proceed with a planned fundraising round as it was linked to the acquisition financing, Sanghvi said. “Now that the large offline acquisition that we were targeting is not happening, we have put off the plan to raise capital,” he said. “We don’t need capital to run the business. We are contributory margin positive,” he added.

Mint was the first to report Good Glamm’s fundraising plans on 26 May. The company was looking to raise close to $200-250 million, valuing it at $2 billion from new and existing investors.

The Warburg Pincus- and Prosus-backed company raised $150 million as part of its Series D funding round in November last year at a $1.2 billion valuation, taking it to the coveted unicorn club of companies valued at a billion dollars or more. Good Glamm also counts L’Occitane, Bessemer Venture Partners, Accel, Amazon, and Ascent Capital among its investors.

In 2021, the company raised capital across four funding rounds to support its inorganic growth plans. It acquired companies such as Mom’s Co., Baby Chakra, St. Botanica, Organic Harvest, ScoopWhoop, MissMalini Entertainment and Sirona.

Good Glamm recorded gross revenue of ₹500 crore in the financial year ended 31 March and a net loss of more than ₹200 crore, Sanghvi said. MyGlamm, the group’s flagship brand, alone earned ₹220 crore, he added.

“Since we got only the last quarter of FY22 when most of the acquisitions were integrated, the numbers are not showing up. But FY23 is going to see a 3x growth from there and we have an internal target of being Ebitda-positive by March 2023,” Sanghvi said. Asked whether it would continue with its inorganic growth strategy, Sanghvi said, “We want to fill gaps in the men’s grooming and offline distribution space. For online and content and media offerings, if something interesting comes along, we might look at it opportunistically”.

The group, said Sanghvi, is also working on improving its unit economics and focusing on cost rationalization. “Across brands, we are trying to rationalize cost. That means we have brought down our number of warehouses from 29 to five and integrated supply chain throughout our group companies,” he said.

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