Colgate Palmolive has agreed to pay €672m ($940m) for Sanex, which is a premium-priced personal care brand with a positioning around healthy skin and strong market share positions in Europe.
Strengthen personal care business
This strategic acquisition, Colgate believes, will greatly strengthen its important personal care business in Europe.
Colgate’s president, Ian Cook, commented, “Sanex is a very strong brand that we have admired for a long time. We are delighted that this acquisition will strengthen Colgate’s positions in the shower gel and deodorant categories in several key countries in Europe and our overall personal care business in that region.”
Sanex is a multi-category personal care brand which last year posted net sales of €187m ($260m), primarily in Western Europe. Its liquid body cleansing and deodorants, mentioned by Cook as the strongest segments, each represent nearly 50 percent of the business.
“Sanex’s unique positioning around skin health is a terrific complement to Palmolive’s natural extracts and skin care positioning, as well as to our Protex brand which focuses on antibacterial protection for skin,” Cook continued.
Unilever was forced to sell Sanex following the acquisition of the brand’s former owner, Sara Lee. Given Unilever’s already strong market position in the deodorants segment with Dove and Rexona, the European Commission deemed the unification with Sanex would give them an unfair advantage.
Heard it through the grapevine…
There were rumors earlier in the month that Colgate was considering a bid for Sanex, along with other big industry players, such as P&G and Henkel.
Analysts believed the sale could fetch up to $1bn for Unilever; however with the Sanex brand being the biggest in the deodorant portfolio, analysts stated the forced sale was going to be a reluctant one for Unilever.
With P&G looking to strengthen its market share, and Henkel boasting big funds following a good financial year, Colgate will have been happy to have beaten off the competition and improve its personal care reach.
In connection with the Sanex acquisition, Colgate has said it will sell its laundry detergent business in Colombia to Unilever for $215m.
“The Sanex acquisition and the divestment of our detergent business in Colombia are both consistent with Colgate’s ongoing strategy to de-emphasize non-core portions of our portfolio while focusing on our high-margin, strategically important oral care, personal care and pet nutrition businesses,” Cook added.
Both deals are subject to approval form the European competition authority.