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Friday, September 3, 1999

Godrej Soaps paid Rs 18 cr to re-acquire brands from Cussons 

Raghu Mohan & Namrata Singh  
Mumbai, Sept 2: Godrej Soaps has paid around Rs 18 crore to Cussons India for acquiring the detergent brands Ezee, Trilo and Key.

While official confirmation could not be obtained, sources close to the deal pegged the consideration at Rs 18 crore.

Godrej Soaps on August 30 announced the acquisition of the three brands from the UK-based Cussons India, but did not disclose the amount at which the purchase took place.

While it is understood that Godrej may have paid a higher amount for re-acquiring the brands, compared with what the company had received when the brands were earlier sold to Procter & Gamble (P&G), industry analysts feel given the turnover of Ezee alone (over Rs 18 crore), Godrej Soaps seems to have got a good deal.

According to the the sources, other companies who were vying for the brands included Marico Industries and Reckitt & Colman.

Ezee, a premium liquid detergent, commands a market share of around 60 per cent in the Rs 35-crore market. Godrej Soaps has another brand in liquiddetergents called Dip, which has a market share of 15 per cent. Dip was launched after Ezee was transferred to P&G.

The company said that the acquisition of Ezee will help add to its topline growth, making Godrej a dominant player in the liquid detergents market. Ezee was launched in 1983 by Godrej Soaps.

The brands have changed hands three times in the last six years before coming back to the fold of Godrej, which originally owned the brands. The brand was transferred to P&G from Godrej Soaps as part of the joint-venture agreement between the two companies. The agreement was called off in 1996. Cussons India then took control of the brands in 1998.

As compared to Ezee, which is an active product at the retail end, Trilo and Key are perceived to have growth potential in the rural markets. Godrej Soaps will, however, have to define a clear marketing strategy to push these two brands, feel analysts. While Key does not exist in the market, Trilo has a strong presence in Andhra Pradesh.

Godrej Soaps hasindicated its intention to become a serious player in the fast-moving consumer goods industry, and is said to be keenly looking at acquisitions as a tool of growth. Besides, Godrej Soaps has also announced its decision to distribute and sell the Imperial Leather soap and talc brand owned by Cussons India.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.


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