Marico all set to acquire erstwhile Paras Personal Care Business from Reckitt Benckiser
The transaction envisages transfer of all key assets including intellectual property rights, supplyagreements and third party manufacturing agreements (Paras PC business), for an undisclosedconsideration. These assets are in the process of being transferred to a separate company inwhich Marico will acquire 100% shares. The closing of the transaction is scheduled to take placeover the next few months.
The Paras PC business is expected to achieve a turnover of over Rs. 150 crore during FY12.Brands in the portfolio are amongst the top three positions in the hair gels, male deodorant and leave-on hair serum categories. This acquisition gives Marico an opportunity to participate in the rapidly growing deodorant and male grooming categories in India. The portfolio addresses the grooming needs of the youth and is supported by India's demographic profile. Marico will also leverage its distribution strength in India to provide a fillip to the growth of the brands. The acquisition of this business is expected to further reduce Marico's dependence on edibles oils and hair oils.
Saugata Gupta, CEO, Consumer Products Business, Marico, said "I am excited about this acquisition. It fast-forwards our journey towards creating a portfolio for the future with a significant presence in the male grooming and post wash hair care segments."
Milind Sarwate, Group CFO and CHRO, Marico, stated, "This strategic acquisition is a significant building block for value creation for Marico shareholders through profitable sustainable growth over the long term. We will fund the acquisition through a judicious mix of internal accruals, equity and debt."