Consumer products maker Dabur India Ltd said on Wednesday it will acquire two South African companies for 50 million rand ($3.8 million) in cash to expand its presence on the African continent.
The company will acquire D&A Cosmetics Proprietary Ltd for about 48 million rand and Atlanta Body & Health Products Proprietary Ltd for the remaining amount, Dabur said in a filing to the stock exchanges.
Dabur will make the acquisitions through step-down subsidiary Dabur South Africa (Pty) Ltd, it added. Both the companies are majority owned by AJ Bodenstein.
D&A Cosmetics, which was founded in 2000, develops, makes and sells personal care and hair care products to wholesale and retail customers in South Africa, Namibia, Swaziland, Botswana and Lesotho. The company reported revenue of 24 million rand in 2016, up from 22 million rand the previous year.
Atlanta Body & Health Products, which was founded in 1995, sells and distributes brands for salons in South Africa. The company generated revenue of 2.9 million rand in 2016 against 2.8 million rand the previous year.
Dabur's Africa bet
These deals come just six months after Dabur said it would acquire the personal care, hair care and creams businesses of the South Africa-based CTL group of companies. The deal, valued at $1.5 million, marked Dabur’s entry into the South African personal care market.
This deal was preceded by Dabur’s first takeover deal on the continent in July last year when it had bought South African cosmetics manufacturing and trading firm Discaria.
In July 2010, Dabur had made its first foreign acquisition by buying Hobi Kozmetik Group, a personal care products company in Turkey, for $69 million. The same year, it clinched its biggest deal so far by acquiring Namaste Laboratories in the US for $100 million.
Dabur CFO Lalit Malik had told VCCircle earlier that the company would prefer a ‘string of pearls’ strategy for its overseas acquisitions.
Dabur’s rival Godrej Consumer Products Ltd has also made several acquisitions in recent years. Godrej Consumer made a string of acquisitions last year to boost its African operations.