ITC to acquire J&J’s Savlon, Shower To Shower; expand FMCG portfolio

KOLKATA: Kolkata-headquartered cigarettes-to-hotels conglomerate ITC has entered into an agreement with Johnson & Johnson (J&J) to acquire Savlon and Shower To Shower trademarks and other intellectual property (IP) primarily for use in India in order to expand its FMCG portfolio. 


Savlon is an antiseptic brand while Shower To Shower is a personal care product brand. 

It should be noted that this acquisition, which will be ITC’s first purchase in the personal care segment, is in line with the company’s growing focus on its non-cigarette FMCG business. 


“The company has entered into asset purchase agreements with Johnson & Johnson, India & Johnson & Johnson, Singapore on 12 February for purchase of Savlon and Shower To Shower trademarks and other intellectual property, respectively, primarily for use in India,” ITC said in a BSE filing. 


These agreements are subject to customary closing conditions and regulatory permissions as may be necessary, the filing further reveals.


A senior official on the condition of anonymity said that the company has used inorganic route to expand and strengthen its business earlier. “We acquired juice brand B Natural for our entry into fruit beverages market,” he said.


When being asked to comment on the revenues ITC is looking at, he said that the current acquisition is in line with ITC’s aim for a revenue of approximately Rs 1,00,000 crore from the new FMCG businesses alone by the end of year 2030.


ITC had acquired Bangalore-based Balan Natural Food’s B Natural brand last year to strengthen its portfolio. 


When asked to comment, ITC declined to divulge the size of the deal for purchasing the two brands from Johnson & Johnson.


However when some analysts tracking FMCG firms were contacted to comment on the probabilities of the deal, they assume that the size of the current acquisition would be small compared to ITC’s total size of the business. 


After this acquisition, the company’s topline in FMCG segment may go up by a small amount of about one per cent, said a Kolkata based analyst. 


ITC’s non-cigarette FMCG revenue stood at around Rs 8,122 crore during the financial year 2013-14. 

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