Godrej Consumer Products (GCPL) today announced that it has entered into an agreement to 60% stake in Cosmetica Nacional, a market leader in hair colorant and cosmetics company in Chile.
The company has a strong portfolio of brands in the hair care and colour cosmetics segments. With its brands well-positioned acorss income and age levels, Cosmetica Nacional enjoys greater than 30% market share (by volume) in the hair colorant space. With this move, GCPL continues to expand its focussed presence in emerging markets in line with its "global 3x3 strategy".
Cosmetica Nacional, founded in 1979 and led by founder and CEO Fernando Garcia, had sales of about $36 million in 2011 and enjoys an EBITDA margin of 20%. With a strong history of product innovation, its brand Ilicit has been very successful with market leadership for the last 10 years.
Commenting on the partnership, Adi Godrej, chairman of GCPL said, "Cosmetica Nacional is a natural addition to our earlier acquisitions in Latin America. The Chilean business will strengthen our presence in the region and set us on a firm footing to achieve our plans for Latin America."
He added, "We believe that the Latin American Market has strong growth potential in household and personal care and that this partnership positions us well to further establish our presence in the region and take advantage of the future growth opportunities."
The news has seen shares of the FMCG major jump more than 10% on the BSE, even as the broader market was in the negative territory.
The shares, however, pared some of the initial gains and were trading at Rs 427.50, up 6.17% on the BSE.
The scrip was quoted at Rs 427.75, higher by 6.19%, on the NSE at 11:34 am.
In the last couple of years, GCPL has been on an aggressive acquisition spree, buying companies in Nigeria, Indonesia, Malaysia particularly in the hair care and household insecticide space.
