Emami buys Dermicool from Reckitt for Rs 432 crore

FMCG company Emami on Friday announced the acquisition of Dermicool, one of the leading brands in the Prickly Heat Powder and Cool Talc category, from consumer giant Reckitt for a total consideration of Rs 432 crore. After the acquisition, Emami will become a marker leader in this niche segment.

“The acquisition is funded through internal accruals and is subject to customary closing conditions,” Emami said in a statement, adding Dermicool commands 20% market share in the high growth and low penetrated category. “Combined with Emami’s Navratna Cool Talc, Emami will become the leader in this niche category which would also help realise synergetic benefits and optimize costs,” it added.

The prickly Heat powder and Cool Talc category is worth about Rs 750-800 crore now.

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“We already have Navratna Cool Talc in the category. Navratna is currently the no. 2 brand and Dermicool is no. 3. And now, after this acquisition we will be no. 1 in this category,” Harsha V Agarwal, director, Emami, told FE. “This acquisition is in the consumer care segment. Our plan is to add more products under the Dermicool brand. We will decide on the timing of the brand extension after consolidation. After the consolidation we will be looking into the opportunities and possibilities of extension,” Agarwal said.

“During the pre-Covid times till 2019, the segment was growing 10-12% CAGR. During Covid times the category was impacted. We are very hopeful that in the next fiscal the category will grow at the pre-Covid level rate,” he added.