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Emami may join race to acquire UK's Simple

By Viveat Susan Pinto in Mumbai
December 04, 2009 02:27 IST
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Emami may join the race to buy Simple, one of the largest skincare brands in the United Kingdom. Sources familiar with the development say the company is exploring all options and may approach the management of the UK-based company shortly.

"A final call will be taken in the next few days," a source from within the company said. Analysts say if Emami can lay its hands on Simple, the acquisition is likely to give the company the necessary foothold it is seeking in the UK market.

Simple's promoters, a private equity group Duke Street Capital, put the brand on the block recently. And Emami is the fourth company to show an interest in acquiring the skincare major, which is estimated  to be worth around £250 million (over Rs 1,900 crore). The other three companies reportedly in the race are Godrej Consumer Products, Marico and Wipro Consumer Care & Lighting. None of these companies, however, have either confirmed or denied the developments.

Like most mid-tier players in the FMCG sector, Emami has been aggressive with acquisitions in the last few years. The Rs 755-crore company (consolidated net sales ending March 31, 2009), which has a presence in the personal care and healthcare domains, has made a few but decisive steps to enlarge its portfolio of brands by acquiring majority stakes. For instance, it acquired Zandu Pharmaceuticals last year.

Emami is also reportedly in talks with Godrej Hershey's Beverages and Foods to acquire its Jumpin and XS beverage brands. If the buyout happens, it will mark Emami's entry into a new area altogether — beverages.

Though the company has been exporting its products abroad, it has been looking at a more meaningful presence through buyouts of brands/companies overseas.

For instance, Emami made a failed attempt to acquire the Singapore-based Unza Holdings Ltd -- South-East Asia's largest manufacturer of personal care products -- in 2007, which it lost to Wipro Consumer Care & Lighting.

Almost all major FMCG companies were in the fray for Unza back then, including Dabur, Hindustan Unilever and Colgate Palmolive.

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Viveat Susan Pinto in Mumbai
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