Godrej Consumer Products completes acquisition of Megasari Group in Indonesia
17 May 2010
Godrej Consumer Products Ltd (GCPL) today announced the completion of its acquisition of PT Megasari Makmur Group and its distribution company in Indonesia.
Megasari Group manufactures and distributes a wide range of household products, including household insecticides, wet tissues and air fresheners. The group's products are market leaders in Indonesia in most of the categories that the company operates in.
The acquisition, which has been funded by overseas debt "at a very attractive price", is expected to be accretive for GCPL in the very first year itself, the company said in a filing with the Bombay Stock Exchange (BSE).
"Megasari Group provides us a strong platform to establish a significant foothold in Indonesia, which is among the largest consumer markets in Asia. Given Megasari Group's leading position in household product categories in Indonesia and the Godrej Group's strong presence in this category in India, we believe this acquisition will provide significant synergies and create value for shareholders," Adi Godrej, chairman of GCPL, said.
"As an emerging market multinational, this acquisition is an important step in our global 3 by 3 strategy - presence in 3 continents - Asia, Africa and Latin America through 3 core categories - home care, personal wash and hair care. Over the last few years, we have been following a very disciplined and focused approach to identifying acquisitions that represent a strong fit with our business, both strategically and operationally," he added.
Megasari Group's current management team will continue to be involved with the companies.
Godrej Group has put in place a cross functional team consisting of current Megasari employees and Godrej's team from India. The cross-functional team is being led by Naveen Gupta who has 14 years of FMCG experience and has spent 8 years in Godrej Sara Lee's international operations.
"Megasari Group fits in very well with our entrepreneurial culture and aspiration to become a global powerhouse in household insecticides. We will achieve this by leveraging our significant expertise in this space in related consumer markets that provide attractive growth prospects. As one of the largest household insecticide and air care companies in Indonesia, the company has a strong track record in innovative high quality value-for-money products to the Indonesian consumer. We look forward to working with the seasoned Megasari team to further accelerate growth and leverage synergies between Megasari Group and the Godrej Group," A Mahendran, director, FMCG portfolio cell for the Godrej Group, added.