Indian personal and healthcare FMCG company Emami Limited has announced the acquisition of the German personal care brand Creme 21, which has major business in the Middle-East and other markets. The brand has been acquired at less than 1.5 times of its sales. This international acquisition is in line with the company’s strategy for growth through inorganic route.
The acquisition is expected to boost and complement Emami’s international business and portfolio particularly in MENA, SAARC and Russian markets.
Creme 21 offers skin care and body care products such as creams and lotions, shower gels, sun care range, men’s range, etc. The German brand was acquired by Antje J Willems Stickel in 2003. Over 80% of the brand’s business is contributed by the MENA region and the balance by Germany and other markets.
The products are manufactured by a third party in Germany under the asset lean model. With current sales at over Euro 8 million and a gross margin of over 50%, Emami expects to take this brand on an aggressive growth trajectory. The acquisition is being funded from internal accruals.
Harsha V Agarwal, Director, Emami Limited, said, “The acquisition of Creme 21 has a strong business fit as it operates in Emami’s focus markets and chosen categories. We plan to leverage our existing network of distribution and infrastructure to grow the brand. Creme 21 is an iconic German brand that has a high brand recall. The brand has good potential for growth and we expect it to add value to our growth trajectory. With this acquisition, the company would be able to enjoy economies of scale due to additional business base.”
Commenting on the deal, Stickel, promoter of Creme 21, added, “We are excited about this deal and with Emami’s strength in Middle-East and other global markets, we are confident that Emami would add lot of value to Creme 21 and take it to the next level.”
Emami is the flagship company of the diversified Emami Group of Companies. It is engaged in the business of manufacturing and marketing personal care, healthcare and beauty products. The company’s portfolio comprises more than 300 products. Emami’s leading brands are Navratna, Boroplus, Zandu, Fair and Handsome and Kesh King.
Emami has a strong domestic distribution network of more than 3,500 distributors and 4,000 sub-distributors, with a direct reach across 725,000 retail outlets.
Emami also exports to over 60 countries and has a strong presence in Russia, CIS, GCC, SAARC and African countries. It has subsidiaries in UAE, Bangladesh, Sri Lanka, Egypt and Australia.
Emami currently has a market capitalisation of approximately US$ 2.7 bn.
Creme 21 was launched in 1970 for people over 21 years of age. The bright orange colour and distinctive packaging represented modernity and happiness, which helped the brand to conquer consumers’ hearts. All the Creme 21 products are developed and produced in Germany.