Dealer sources in Mumbai confirmed the move saying that while the per dealer area has been reduced to accommodate the new dealers from Lakme, each dealer is now handling more products than before.

The merger involves offering HLL stockists to distribute Lakme products and vice-versa. The merger is effective from January this year, and marks the beginning of the calendar year in which the multinational operates financially.

An HLL spokesperson when contacted said: ``It will help in expansion as now Lever products will be made available where they traditionally were not and at the same time Lakme products will mark their presence in those areas where they traditionally were not present.''

The HLL dealers who were earlier handling only the conventional Lever products likesoaps, detergents and personal products, have now been stocked with cosmetics and toiletries products from the Lakme portfolio. The move is seen by analysts as giving a boost to the Lakme brands which will now have a wider penetration network so as to maintain its number one position in the cosmetics and toiletries industry. Further, Lakme will emerge as having one of the strongest distribution network among other cosmetics companies.

HLL had announced its plans to take control of the 50:50 joint venture company with Lakme Ltd in February last year. However, at that time it was understood that Levers would only be adding value with its financial strength. It was believed that Lakme's existing network would be gradually increased, without it being integrated with the Levers system. Now,analysts say that HLL has exploited the synergy which exists between Lakme's cosmetics and toiletries portfolio and HLL's personal products thus streamlining the handling and dispatching of stocks which will not be a problemwith dealers. Further, giving consumer offers on either of the products will be less cumbersome and this would also augur well for HLL and Lakme product volumes.