Mensa Brands sued by Bo International over breach of contract: Report
Bo International CEO Aayush Gupta alleges that the company has not received full payment for the sale of Florona to Mensa Brands.
Bo International, the parent company of aromatherapy and personal care brand Florona, has initiated litigation against Mensa Brand Technologies over the latter's failure in performing its obligations as per a business transfer agreement that the two parties signed in 2021.
Bo International intends to initiate arbitration proceedings against Mensa Brands, according to a petition filed with the Delhi High Court by Aayush Gupta, Founder and CEO of Bo International, Moneycontrol reported.
The plea states that Bo International wants the court to direct Mensa Brands to maintain the status quo related to the agreement for the sale of its brand Florona. Gupta has also sought a deposit of Rs 26.95 crore, according to the report.
Bo International entered into an agreement with Mensa's subsidiary Caleum Arpit Brand Technologies in December 2021 to buy aromatherapy and natural personal care brand Florona, per the report. As per Bo International, Mensa was supposed to pay it in two tranches, Rs 10.2 crore as the first tranche six months after signing formalities and the second tranche—a revenue-linked consideration—payable as a percentage of the product’s sales till 2026.
The report added that the two parties had agreed that Bo International would manufacture, store, and deliver the products to Mensa.
"We deny the claims made by Aayush and Bo International. Caelum Arpit and its representatives are being harassed with frivolous complaints and litigation. As the matter is sub-judice, we would respectfully like to refrain from commenting on the exact nature of the dispute. Needless to say, we will pursue every remedy that is available to us under law," a Mensa Brands spokesperson said in response to YourStory's queries.
Mensa Brands acquired Bo International-owned Florona in January 2022 at a valuation of Rs 30 crore at the time of signing the agreement, the report stated. However, Bo International said that while Mensa paid Rs 10.2 crore as the first tranche, it received Rs 5.69 crore as the revenue-linked consideration to date, indicating that this is not the full payment for the sale of Florona, the report said.
Bo International has also alleged that As Caleum had claimed that Florana will soar to new heights, and the payout plan indicated a revenue-linked consideration was Rs 404 crore, according to Moneycontrol. According to the plea, Caleum has not made any payment after March 2023.
(The story was updated with a comment from Mensa Brands.)
Edited by Saheli Sen Gupta