Diversified conglomerate ITC Ltd has reached agreements with Johnson & Johnson Ltd, India, and Johnson & Johnson Pte Ltd, Singapore, to acquire their brands Savlon and Shower To Shower for an undisclosed sum.
“These two trademarks and other intellectual property will be purchased by ITC for use primarily in India,” the company said in the filing with the bourses. These agreements are subject to regulatory permissions.
According to sources, J&J was looking to sell the two brands in India for over ₹300 crore.
The Savlon portfolio focuses on the cuts, wound and personal hygiene categories with antiseptic lotions, soaps, hand-wash and liquid washes. It competes with Dettol in these categories.
Shower to Shower is present in the prickly heat powder category and competes with Emami, Himalaya and Nycil. This is ITC’s first acquisition in the personal care category. The company has been focussed on building its own brands in the segment for some time that include Fiama Di Wills, Essenza Di Wills, Vivel, Engage and Superia.
: “This (acquisition) is in line with ITC’s aspiration to achieve a revenue of ₹100,000 crore from the new FMCG businesses by 2030,” a company spokesperson told BusinessLine in an emailed response.
According to Gaurang Kakkad, Vice-President, Institutional Research, Religare Capital Markets, the two brands together reported ₹90-crore sales in the FY-14, with Savlon clocking ₹65 crore and Shower to Shower the rest.
“Given the size of the brands acquired, we do not expect the same to have any material impact on ITC,” he said.
For the first nine months this fiscal, other consumer goods accounted for over 21 per cent (or ₹6,445 crore) of the company’s total turnover of ₹30,603 crore.
The ITC stock closed at ₹378.05 on Friday, up 2.01 per cent on BSE.