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Dabur completes Fem acquisition ; to launch new products

BS Reporter  |  New Delhi 

Having completed the acquisition of Ltd, a player in the women’s market, homegrown FMCG company is now set to extend its herbal heritage to the Fem product portfolio. The company has already developed two products - a bleach and a hair removal cream and will roll them out next month for test marketing.

“The brand architecture of Fem Care brands is different from the brands and will hence be developed as a separate business,” India CEO Sunil Duggal told Business Standard.

The portfolio expansion is in line with Dabur’s aim to grow its business in the Rs 2,500 crore high-growth domestic skin-care market where it has some presence with Gulabari and Vatika brands.

Dabur plans to operate its skin care vertical under three core categories.On the one hand it will roll out new products in the rose based Gulabari brand in the mid-range segment, it will cater to the entire spectrum of mass to premium skin care category with its brand Fem. A new ayurvedic skin care brand will form the third rung of the skin care vertical and will operate in the ‘masstige’ (mass prestige) category allowing Dabur to have a portfolio across price segments.

Dabur announced that it has completed the acquisition of Ltd, after the transaction was approved at a board meeting held in Mumbai today and is now a subsidiary of Dabur.

Last year, the company had acquired 72.15 per cent of Fem for Rs 203.7 Crores in an all-cash deal. After obtaining the regulatory approvals, Dabur acquired additional 20 per cent stake for Rs 54 Crores through an open offer.

“The focus of the management will be to drive the topline and not so much about cutting costs as it is a high margin business,” Duggal added. The company will also aggressively invest behind promoting the brand through above-the-line marketing.

Further, the company plans to leverage its overseas network to export the Fem Care brands and grow its brand equity. Fem Care already has a sizeable international market presence in markets such as Yemen, Maldives, Mauritius, Malaysia, UAE, Oman amongst others. “We will continue to manufacture Fem products from its present two factories and will not manufacture overseas as of now,” he added.

Fem Care’s acquisition will allow Dabur to drive its core FMCG business as well as consolidate its position as a leading Indian consumer goods company with presence across key categories like skin care, hair care, oral care, health care and foods.

“We are now focused on quickly seizing the attractive opportunities this transaction has created for us to increase top-line growth as well as achieving significant cost synergies,” Duggal added.

Fem Care Pharma, which has a leadership position in the fairness bleach category and a strong market position in hair removal and liquid soap category, is best known for its brand ‘Fem’. The other brands in its portfolio include Oxybleach cream, Botanica anti-ageing cream, Stratum colour protecting hair conditioners and SAKA men’s bleach.

First Published: Thu, June 25 2009. 18:02 IST