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Cult.fit has disclosed a major change to its long-standing association with Hrithik Roshan's activewear brand HRX ahead of its planned initial public offering (IPO). According to the company's Draft Red Herring Prospectus (DRHP) filed with the Securities and Exchange Board of India (SEBI), Cult.fit has terminated its exclusive agreement with Extreme Brands LLP, the company that owns the rights to the HRX brand.
Hrithik Roshan’s HRX exits Cult.fit brand partnership ahead of IPO; actor to remain investor
Exclusive HRX agreement comes to an end
Cult.fit had entered into an agreement with Extreme Brands LLP on August 11, 2023, securing perpetual and exclusive rights to the HRX brand. While the company did not disclose the annual consideration for the arrangement, the agreement reportedly carried a contingent liability of nearly Rs 30 crores.
The latest DRHP, however, confirms that the agreement has now been terminated. The filing has not disclosed the reasons behind the decision or whether the move will have any impact on Cult.fit's branding strategy going forward.
Hrithik Roshan to sell part of his stake through OFS
The DRHP also reveals that Hrithik Roshan will participate in the Offer for Sale by selling 6.33 lakhs equity shares. Despite the partial divestment, the actor will continue to remain an investor in the company after the IPO.
Hrithik first invested in Cult.fit in May 2018 when he came on board as the company's brand ambassador. He reportedly invested around Rs 3.75 crores, and the value of that stake has grown significantly over the years. Based on Cult.fit's latest valuation, the investment is estimated to be worth approximately Rs 25 crores.
Alongside the actor, his affiliated entity, Extreme Brands LLP, also invested around Rs 2.25 crores in the company.
The development comes as the Bengaluru-based fitness and wellness company prepares to go public with a proposed fresh issue of shares worth Rs 950 crores, along with an Offer for Sale (OFS) by several existing shareholders.
Also Read: Hrithik Roshan joins Nissan India as brand ambassador for Tekton SUV
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