Emami already houses another cool talc brand Navratna and expects to become a leader in this category with the recent acquisition of Dermicool. (PC: Udaan.com)
Boroplus maker Emami has acquired Dermicool, one of the leading brands in the prickly heat and cool talc category, from FMCG major Reckitt for a total consideration of Rs 432 crore (excluding taxes and duties), the company informed in a stock exchange filing on Friday.
“The acquisition is funded through internal accruals and is subject to customary closing conditions,” the company added.
Known for its popular jingle, ‘aaya mausam thande thande Dermicool ka’, the talc brand, according to Emami, commands a 20 percent market share in the category. The company also sells cool talc under Navratna and BoroPlus Ice.
According to industry stakeholders, Navratna is the second-largest brand in the segment after Nycil (owned by Zydus Wellness) while Dermicool comes in third. Boroplus Ice does not have a significant share in the market.
Now, with the acquisition of Dermicool, Emami aims to be a leader in this category.
“We have understood through consumer research that both Dermicool and Navratna operate in different areas though they are in the prickly heat category. Navratna stands for coolness and Dermicool stands for prickly heat as well as coolness,” Harsha V Agarwal, director, Emami told Moneycontrol.
“The equity of both the brands in the consumer mind is different and therefore there is a strong case for both the brands to coexist,” he added.
Dermicool has seen a frequent change of hands over the years. It was acquired by Reckitt (then Reckitt Benckiser) as part of a larger deal with the acquisition of its owner Paras Pharmaceuticals and other popular brands such as Moov, D’Cold, and Krack for Rs 3,260 crore in 2010. The brand was the second-largest player in the market then but eventually was toppled by Navratna.
Even as it eyes a larger share of the market through Navratna and Dermicool, Emami does not have any major ambitions for the third brand Boroplus Ice.
“It will continue to be in our portfolio but it is more like a floater brand and we do not invest much in it,” said Goenka.
Emami over the years has acquired a host of consumer goods brands such as Zandu, Kesh King, and the German brand Creme 21. It was also one of the companies in the top race to acquire other top brands from the house of Paras Pharmaceuticals – Set Wet, Livon, and Zatak – when Reckitt put them on the block in 2012. However, it was edged out by Marico.
“Emami, as one of its core business strategies, has always been open to growth through inorganic route. The company considers acquisitions that not only add value and have synergy with the current line of businesses but also offer opportunities for the organization to be present in categories that have high growth potential,” the company said in a media statement.
Emami’s leading brands are Boroplus, Navratna, Zandu, Fair & Handsome, and Kesh King among others. It has a strong domestic distribution network of more than 3,500 distributors and 4,000 sub-distributors, with a direct reach across 900,000 retail outlets and an overall reach to over 45 lakh outlets. Emami also exports to over 60 countries.Emami acquires Dermicool from Reckitt for Rs 432 crore - Moneycontrol
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