Q&A: Chander Mohan Sethi, CMD, Reckitt Benckiser India

'We will build on Paras' strengths'

Chander Mohan Sethi, chairman & managing director, Reckitt Benckiser India, spoke to Viveat Susan Pinto on what the Paras Pharmaceuticals’ acquisition means to Reckitt. Edited excerpts:

How are you likely to fund the transaction? How soon are you likely to close the deal?
Our available facilities are £3.4 billion. We do not disclose the cost of our individual facilities: however, suffice it to say that RB is able to fund at very attractive levels. The transaction will likely close at the end of or possibly early in Q2 of 2011, owing to the finalising of tax and legal matters. This is when the cash will be paid.

When is the brand integration likely to happen?
We’re not disclosing the expected synergies, nor their timing. RB already has good infrastructure and distribution in India and the synergies will be attractive.

Reckitt wasn’t in the initial list of probables. What made you decide to get in?
Paras has delivered mid-teen net sales growth on average over the past four years, and has successfully created a number of well-loved and admired brands. With RB's investment and innovation strength, we expect to build on this success.

How are you likely to grow the Paras brands?
We're not about to start giving growth forecasts. On a broader level, RB’s developing markets’ net revenue growth (at constant exchange) is approximately double the underlying market growth on a YTD (year to date) September 2010 basis. We continue to perform very strongly in developing markets, overall.

Will Paras brands be exported to other markets?
Depending on the potential and requirement, we will look to export Paras brands abroad.

Will more acquisitions happen?
The strategy is led by RB global and would happen at the right time and right stage.

Which other power brands from the global portfolio are you getting into the Indian market?
We have 11 of the 19 power brands in India. The roll out depends on the readiness of market and consumers.