Business Daily from THE HINDU group of publications
Wednesday, Jul 05, 2006
Business Daily from THE HINDU group of publications Wednesday, Jul 05, 2006 |
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Corporate
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Mergers & Acquisitions Godrej Consumer buys hair-colour biz in S. Africa Our Bureau
Mumbai , July 4 In its second international acquisition in less than a year, Godrej Consumer Products Ltd (GCPL) has entered into an agreement for the acquisition of the South African hair-colour business of Rapidol, UK, as well as its subsidiary Rapidol international, for an undisclosed sum.
Access to ethnic market
The all-cash deal is subject to regulatory approvals. The two units have a combined turnover of 52 million South African Rand, (about Rs 33 crore) in 2005, according to a GCPL note. The acquisition gives Godrej access to a large ethnic hair-colour market via a profit-making company. It would also augment GCPL's topline and bottomline, the company told the Bombay Stock Exchange. Mr Adi Godrej, Chairman and Managing Director of GCPL, said, "This transaction is consistent with our endeavour to build a strong personal and household care business both in India and across the globe, especially in hair-colours. Rapidol South Africa is a profit making company that manufactures and markets premium hair-colourants in the African market. "The acquisition of the Inecto and Soflene brands will widen our portfolio of hair colourant and hair care offerings and give us access to the large and growing African market. We also propose to introduce some of our own products there, via Rapidol's established distribution network, " He indicated that further growth would be driven through organic and inorganic opportunities in India and overseas.
Springboard
The deal also provides GCPL an opportunity to acquire the Inecto and Sofelene trademarks that would allow the company larger territorial rights over the brand equities. Further, it will also provide a springboard for the introduction of GCPL's products in South Africa and other African countries. Rapidol South Africa owns Inecto, an internationally known brand, popular with consumers across South Africa and the African Continent. GCPL shares remained flat at Rs 644 on the BSE.
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