Emami acquires Australia-based personal care company Fravin

Acquisitions rule the roost in the personal care segment. Following Godrej and Marico, Kolkata-based FMCG major Emami has announced a global acquisition to expand its portfolio.

Emami has acquired controlling stake of 66.67 per cent in Australia-based Fravin, inclding its three subsidiaries for an undisclosed sum.

Fravin, which manufactures natural and organic personal care products, has a portfolio of 100 products and Emami looks to distribute them in other markets like the US.

Homegrown consumer products company Marico had acquired the personal care portfolio of Paras from British consumer goods maker Reckitt Benckiser in early 2012. The deal included brands like Livon, Set Wet and Zatak.

The acquisition had complemented Marico's existing business, which includes mainly hair oil brand Parachute and edible oil Saffola, giving it a better foothold in the male grooming segment.

Similarly, Indian FMCG giant Godrej Consumer Products (GCPL) had acquired 51 per cent stake in the hair extension business of African major Darling Group Holdings in Ghana.

Darling operates in 14 countries across sub-Saharan Africa.

Godrej held the right to acquire 100 per cent in the operations across countries by 2016.

In February 2014, GCPL had completed the acquisition of Darling Group's hair extension business in Nigeria by acquiring the balance 49 per cent.

In March it also entered into an agreement to hike its stake in Darling's entities in South Africa and Mozambique by 4.63 per cent to 55.6 per cent each.

An investment banker with a global bank says that personal care is a lucrative category, where everybody wants to invest for products.

"India is considered to be one of the fastest-growing personal care products markets in the world. We are well behind the developed markets in innovations of these types of products. Acquisitions will help the Indian players stay put amidst the competition from global players."

Another banker with Nomura says that there are more acquisition queries in this segment.

Emami Director Harsh Agarwal said that the Fravin acquisition is in sync with the company's strategy to grow aggressively through both organic and inorganic routes in India and overseas.

The acquisition marks Emami's entry into organic personal care products where it was not present earlier.

The sector has high growth potential.

"The market for organic personal care products is growing at a rapid pace across the world. The global market for organic products, which was over $7.6 billion in 2013, is expected to double in six years," Agarwal said.