Hindustan Sanitaryware & Industries Limited (HSIL), known by its Hindware sanitaryware brand, is eyeing buyouts in Europe as part of its global expansion plans. It is learnt that the Somany Group-owned company is planning brand buyouts in Italy, regarded as a country renowned for its sanitaryware brands. HSIL has a 40% market share of the Indian sanitaryware market.
Anil Chandani, VP, Corporate Finance, HSIL, told VCCircle, “We are keen on brand buyouts in European countries. Brand buyouts is a viable model compared to acquiring the entire company as manufacturing abroad is not cost-effective. As far as brands are concerned, Italian brands are the most popular across the globe.” However, he refused to disclose more details on their plans. Fund-raising will not be a concern for the company as it has already received approval from shareholders to raise up to Rs 150 crore through various private placements.
According to a report by The Centre for the Promotion of Imports from developing countries, a European agency, Italy is the largest market in the EU for sanitaryware and ceramic tiles. In 2008, it amounted to €3.6 billion, after a growth of 4.6% per year since 2004.
In March, the Rs 836-crore HSIL Ltd acquired the business of manufacturing and dealing in chrome plated brass bathroom fittings and accessories under the brand ‘Crabtree’ from Havells India Ltd. HSIL entered into a strategic alliance with $1.5- billion Sanitec Group of Finland to exclusively market their flagship brand Keramag in India. HSIL Limited has also tied up with TEUCO, the largest Italian designer brand, to launch premium bathtubs & multi-functions in India.
According to the report, Italy counted 43 ceramic sanitaryware producers in 2008, including 37 in the Civita Castellana district (province of Viterbo), the most important manufacturing cluster for this sector in Italy. Activities took place in 53 factories, of which 42 are located in the province of Viterbo. Major Italian producers of sanitary ware include Ceramica Althea, Ceramica Esedra, Ceramica Galassia, Hidra Ceramica, Marazzi Group, Novellini, Pozzi Ginori and Varm.
Last year, PTI, quoting Sandip Somany, joint managing director, HSIL, had reported that the company was in talks with 4-5 European companies for acquisition for a deal worth Euro 30-100 million.
The company was established in 1960 in a joint venture with Twyfords, UK. The company changed its name to Hindustan Sanitaryware & Industries Limited in 1969. HSIL has about 1,200 distributors and 12,000 plus retailers across India.
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