HUL acquires intimate hygiene brand from Glenmark
As part of the agreement, HUL will acquire VWash’s business, the brand, trademarks, copyrights and other associated know-how, HUL said in a statement.
The financial specifics of the deal were not disclosed.
The acquisition is in line with HUL’s strategic intention of entering fast-growing segments in the premium beauty and personal care space and will also help the firm to enter the female-focused hygiene segment, it added.
“We look forward to completing the acquisition and strongly believe HUL is well-positioned to further scale up this business, given the strength of our market development and distribution capabilities,” Sanjiv Mehta, chairman and managing director at HUL, said.
In a separate statement, Mumbai-based Glenmark said it would receive an upfront payment for the sale and sales royalties for three years.
Glenmark president of India formulations, Middle East and Africa, Sujesh Vasudevan, said the decision to sell VWash was in line with its strategy of focussing on its core areas. Some of these focus areas for Glenmark include respiratory, dermatology and oncology.
HUL’s stock ended the day 8.77% down at Rs 1,872.55 apiece, while Glenmark closed Monday’s trading 10.69% down at Rs 188 per share. It must be noted here that broader markets are facing severe pressure from investors in the wake of the COVID-19 pandemic.
HUL has not shied away from acquisitions that align with its larger product and market penetration goals. In September last year, reports suggested that the FMCG major had emerged as the front-runner to buy Nagpur-based Dinshaw’s Dairy Foods in an all-cash deal worth nearly Rs 1,000 crore.
In December 2018, HUL said it would acquire GlaxoSmithKline’s Indian consumer nutrition business at an equity valuation of Rs 31,700 crore (around $4.5 billion), in what was reported at the time as the country’s biggest consumer goods deal.
In August that year, the company said it had signed an agreement to acquire the ice cream and frozen desserts business of Karnataka-based Vijaykant Dairy and Food Products Ltd. At the time, HUL said the acquisition was aimed at complementing its existing frozen desserts brand Kwality Wall’s.