Godrej to get fresher with Indonesia

The Rs 2,041-crore Godrej Consumer Products (GCPL) will introduce air freshener products from its Indonesian acquisition, PT Megasari Makmur, chairman Adi Godrej said in an exclusive conversation with Business Standard.

The brand, called Stella, is a leading one in Indonesia, Godrej said. He declined to indicate the time frame of the launch, saying it would fill the gap left by Ambipur, the erstwhile Sara Lee brand, sold globally to Procter & Gamble (P&G) last year.

In India, this brand, with Brylcreem and Kiwi, were vested in the joint venture the Godrej Group had with Sara Lee Corporation. Ambipur, an air freshener brand, was withdrawn after GCPL bought all the equity in the joint venture firm, Godrej Sara Lee.

“Now that the brand has been sold to P&G in India, the task for us is to fill the gap left vacant. Stella will do the needful,” Godrej said. “As far as Brylcreem and Kiwi go, these brands continue to be with us. As and when they are withdrawn, we will be compensated.”.

Internationally, Sara Lee’s Brylcreem was sold to Unilever as part of its personal care products’ acquisition last year. Kiwi is yet to find a buyer. Sara Lee has been looking to exit non-core businesses in an effort to focus on its core food & beverage business.

Integration begins
GCPL, meanwhile, has begun the integration of Godrej Sara Lee, now called Godrej Household Products (GHPL), with it, Godrej said. This follows the company’s decision to merge its subsidiary with it. GCPL today announced its board of directors had approved the merger of GHPL with it, effective April 1.

Godrej says the company is implementing recommendations by McKinsey, the consultancy firm appointed in June to provide a report on how the two companies could be integrated. “There are two levels we are looking at in terms of synergies,” he said. “One is reduction of overheads and variable costs. The second is synergies for accelerated growth. For instance, GCPL is strong in the north, while GHPL is strong in the south. GCPL has a strong rural reach, while GHPL has a strong presence in the chemists channel. These strengths can be leveraged.” The merged entity will sell personal care and household care products, including insecticides.