Wipro bags Unza for Rs 1,010 cr

Wipro Consumer Care & Lighting (WCCL), the consumer care business of infotech major Wipro Ltd, jump-started its overseas foray by acquiring Unza Holdings Ltd, a Singapore-based detergent and personal care products manufacturer, for Rs 1,010.2 crore in an all-cash deal.

Wipro has brought the entire company, including 58.6 per cent held by institutional investors Standard Chartered Bank and Actis, a 35 per cent stake from Unza's management and the rest held by some minority investors. Wipro will fund the acquisition through internal accruals.

Unza owns 48 brands and sells in 40 countries with a strong presence in Indonesia, Malaysia, Singapore, China and Hong Kong.

Unza is said to be South East Asia's largest independent manufacturer and marketer of personal care products with personal care brands Enchanteur, Safi, Romano and Izzi, and two detergent brands Vigor and Maxkleen. 
 

THE VITAL STATS
	WCCL	Unza
Revenue	Rs 818 crore	Rs 683 crore
Operating margin	12.5%	12%
Manpower	Over 2,000	4500
Manufacturing	8 in seven locations	5 in 4 countries (Malaysia-2, Vietnam-1, China-1, Indonesia-1)
Cash/Debt	Wipro's cash reserves around $800 million before this acquisition	Net debt of about $45 mn

Wipro executives added the acquisition would help make it the fastest-growing consumer goods company in Asia as Unza has been growing in double digits.

It will also give Wipro access to a vast portfolio and a presence in new categories like deodorants and household care.

Wipro aims to operate Unza under its present management and brand name as its fully-owned business in Singapore. WCCL contributes about 4 per cent to Wipro's turnover of close to $3.5 billion.

The company expects the revenues from Unza to register on Wipro's balance sheet in the second quarter of the current fiscal.

WCCL's revenue contribution to Wipro's turnover was expected to be 8-9 per cent following the acquisition, although it would not have much impact on the profit, said Vineet Agrawal, president, WCCL.

"This acquisition will double our addressable market size in terms of GDP. Unza has an excellent product range and a large portfolio of strong brands for Asian consumers. We see a lot of similarities between the two entities such as customer focus and empowerment," said Agrawal.

Agrawal said following the acquisition, WCCL was planning to market some of Unza's lotion and shampoo brands in India under Wipro's brand name.

"We will see which brands are relevant to India," he added.

This acquisition will help the combined entity (Unza and Wipro Consumer Care and Lighting) emerge as a strong force in Asia.

This is the first acquisition by Wipro in 2007-08 and the biggest for its consumer care division. The company had earlier announced that it was looking at larger acquisitions.

Wipro is expecting to close the acquisition by the end of July 2007.

In 2003, WCCL acquired the Glucovita brand from Hindustan Unilever for about Rs 5 crore.

In 2004, the company had acquired the ayurvedic soap brand Chandrika for Rs 31 crore, followed by the North West Switches brand from North West Switchgear Ltd for Rs 102 crore in May 2006.