Godrej Consumer Products arm acquires Colgate-Palmolive's Soft & Gentle brand in UK
01 January 2013
Godrej Consumer Products Ltd (GCPL) has acquired Colgate-Palmolive's Soft & Gentle brand for an undisclosed sum, in a bid to expand its personal care product portfolio and its overseas market.
The acquisition was made through its UK-based subsidiary, Keyline Brands Ltd, the company said in a filing with the Bombay Stock Exchange (BSE).
Soft & Gentle, which is the UK's fourth largest female deodorant brand by market share, had posted sales of £21 million in 2011, according to the filing.
"The acquisition of Soft & Gentle by Keyline Brands will add profitable scale to our UK business. Over the last few years, Keyline Brands has delivered good performance and grown in double digits in very tough market environment that is witnessing little to no growth," GCPL chairman Adi Godrej said.
GPCL said the acquisition is being funded by low-cost debt that could place GCPL's consolidated debt equity ratio at 0.03.
Godrej said the company's UK business has historically had a higher mix of distributed brands than owned brands.
"Strategically, we have been working on changing the mix towards owned brands and building more scale in the business. With the Soft & Gentle acquisition, the salience of owned brands will become greater than that of distributed brands," he added.
Keyline Brands managing director Anand Rangaswamy said the company can use the strong latent brand equity combined with updating the fragrance technology to develop further range extensions within the female personal care category.