Henkel parent to bring in more products

Henkel KGaA, the German consumer giant, will gradually launch more products from its global portfolio in India following the merger of Henkel Spic India with Henkel India Ltd.

It is also demerging the marketing activity from the production activity in India. This will be done after the proposed reverse merger of Henkel Spic India Ltd with Henkel India Ltd.

Henkel KGaA controls Henkel India, formerly known as Calcutta Chemicals Company, through Henkel Spic Ltd. Henkel Spic has 92 per cent stake in Henkel India. Henkel Spic has convened an extraordinary general meeting of the shareholders on March 10 on this issue. Incidentally, the swap ratio for the reverse merger has been pegged at 1:1.

The managing director of Henkel Spic India, A Satish Kumar informed that Henkel is likely to introduce more products in India from the global stable. Incidentally, the global Henkel brands already popular in India are Fa, Henko, Check and Mr White.

Besides, it has former Calcutta Chemical brands such as Neem, Margo and Tuhina. The company has 116 products in detergent, cosmetics and hair care segment. However, Satish Kumar, did not disclosed details about the new launches. But sources said that personal care products such as skincare lotions, cream and shampoo are there under Fa brand in the European market.

Besides, Henkel has a very popular detergent brand in Persil in the global market. On the merger Satish Kumar said Henkel India will engage in production only. The marketing part will be taken care of by a wholly owned subsidiary called Henkel India Marketing Company Ltd.

"Henkel India Marketing will be 100 per cent subsidiary of Henkel India. It will look after the marketing and distribution. We shall formalise the entire strategy once we get go ahead from Madras High Court," he said.

According to him, Henkel India, the future production arm of Henkel group in India, will earn from transfer pricing of the products to the marketing subsidiary.

"Now all the brands will be sold under one umbrella," added Kumar. Brands such as Margo, Neem, Laverderdew and Tuhina are now with Henkel India (formerly Calcutta Chemical). Kumar is optimistic that the company will achieve a growth rate of 20 per cent in 2005 after the proposed consolidation of business.

"Our turnover in calendar 2004 was Rs 400 crore. We are expecting a good growth of 20 per cent," Henkel managing director added. Satish Kumar also pointed out that there will be no change in the shareholding pattern after the reverse merger.

Henkel KGaA now holds 51 per cent and the Indian co promoter Tamil Nadu Petroproducts of Muthiahs hold around 17 per cent in Henkel Spic. The Henkel Spic scrip is now hovering at around Rs 25-26 on the BSE.