Nirma In Talks With Henkel Spic For Cosmetics

The Ahmedabad-based detergent major Nirma is in talks with Henkel Spic for a possible tie-up for cosmetics technology.

Henkel, with a $10 billion turnover in 1996, appears to be the logical partner for Nirma as it plans to take on other multinationals in the sector like Procter and Gamble and Lever in India.

Already, Nirma has entered the bath soaps segment after establishing itself in detergents. Cosmetics will be the next rational step, market analysts point out.

For Henkel Spic such a tie-up makes sense since the company is keen on penetrating the lucrative western region. Nirma has established marketing and distribution including an extensive dealership network in the region.

 

Henkel Spic, it may be recalled, had tried to take over the customer products division of Shaw Wallace represented by two subsidiaries -- Detergents India Ltd and Calcutta Chemicals Ltd -- and had even finalised the deal when it fell through at the last moment, because of problems that buffeted the parent company.

Henkel was keen to acquire the two companies mainly to get an established distribution network in the eastern region besides getting brands like Chek and Margo. But with the issue caught up in litigation and the period for the MoU signed with Shaw Wallace lapsing, Henkel Spic decided to give up this strategy.

Consequently, although it has participated in the public auction of the Shaw Wallace subsidiaries, the multinational is not to keen on the acquisition, top company officials say.