Unilever buys soap brands and Mexico facility from P&G

By Andrew MCDOUGALL contact

- Last updated on GMT

Unilever buys soap brands and Mexico facility from P&G

Related tags: Procter & gamble, Unilever

Anglo-Dutch consumer goods firm Unilever is looking to bolster its position in the skin cleansing market in Mexico with the acquisition of two brands from Procter & Gamble.

The company has announced the purchase of the Camay brand globally and the Zest brand outside of North America and the Caribbean from the Ohio-based rival, as well as the acquisition of P&G’s bar soap manufacturing facility in Mexico.

The plant employs approximately 170 people who will transfer to Unilever at the completion of the deal.

“We are excited about the acquisition of the Zest and Camay brands. They represent an excellent strategic fit for us and will further strengthen our global position in skin cleansing. The brands will benefit from our innovation and R&D capabilities,”​ says Alan Jope, president of Unilever Personal Care.

“They will make us one of the market leaders in skin cleansing in Mexico, a priority market for Unilever and one of the largest markets in the world.”

The two brands had a turnover of $225 million in the last fiscal year. The transaction, for an undisclosed amount, is expected to close during the first half of 2015 subject to necessary regulatory approvals.

Strategy

The deal echoes both companies’ strategic focus plans announced last year, as P&G plans to trim its brands portfolio by shedding as many as 100 brands announced last August; and Unilever turns attention to its personal care business having spent the last few years slimming down its food portfolio.

P&G plans to be left with only 70-80 high value brands once its divestment is complete, and continues on from the announcement last November that it was selling its batteries business, Duracell, to Berkshire Hathaway in a deal amounting to $4.7 billion.

Meanwhile Unilever is slowly exiting the foods business, as it is attempting to strengthen its position in the global personal care industry.

The share of its personal care unit has grown from 28% to 36% between 2008 and 2013 and the company has stated that cash generation from the foods business is being used to finance faster expansion in its personal care unit.

Related topics: Business & Financial

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