DABUR India has announced the acquisition of 72.15% of women’s skincare
company Fem Care Pharma (FCPL) for Rs 203.7 crore in an all-cash deal.
The transaction ascribes a price per share of Rs 800, which translates into an equity valuation of Rs 282.4 crore and an enterprise valuation of approximately Rs 300 crore of Fem Care Pharma. Dabur will make an open offer for an additional 20% shares in the company as required under Indian takeover regulations.
KPMG Corporate Finance was the financial advisor to the promoters of Fem Care Pharma while Ambit Corporate Finance was the advisor to Dabur. “The acquisition of Fem Care Pharma is in line with our strategy to aggressively expand Dabur’s scale of operations and strengthen its presence in the FMCG space. This transaction would give Dabur an entry into the high-growth skincare market with an established brand. Further, Dabur also has the potential to extend the brand into newer and related skincare categories,” Dabur chairman Anand Burman said in a statement.
Fem Care Pharma has a strong presence in the fairness bleach and hair removal categories. It also has a liquid soap under the brand name Fem. Other brands in its portfolio include Oxybleach cream, Botanica anti-ageing cream, Stratum colour protecting hair conditioners, Saka’s men’s bleach and Bambi fabric s o f t e n e r s . FCPL, which reported a consolidated net profit of Rs 9.75 crore in the first half of the 2008-09 fiscal on a turnover of Rs 54.45 crore, also has a sizeable international market presence in countries such as Yemen, Maldives, Mauritius, Malaysia, UAE and Oman.
Analysts said the deal will give Dabur’s consumer care division a strong foothold in the rapidly growing women’s skincare segment and pave the way for entry into newer categories. This is the second big acquisition for Dabur after it had bought Balsara’s hygiene and home products business in 2005 for about Rs 143 crore.
Fem Care Pharma joint MD Sunita Ramnathkar said: “The deal will help expand the distribution of Fem’s brands across India and fuel faster growth for the company, both in India and abroad, thereby enhancing shareholder value.”
The BSE-listed Fem Care Pharma has manufacturing facilities in Nashik (Maharashtra) and Baddi (Himachal Pradesh). Its distribution reach covers 1.25 lakh retail outlets and 25,000 parlours directly.
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