Hindustan Unilever Ltd. has agreed to acquire VWash, an intimate feminine hygiene brand from Glenmark Pharmaceuticals Ltd. The acquisition will help HUL to focus on its segments in the premium beauty and personal care category. The decision falls in line with Glenmark's strategy to focus on its core therapy areas.
Post acquisition of VWash by HUL Glenmark’s will focus on its other leading brands like Candid Powder (for skin infection), Scalpe (anti-dandruff shampoo) and introduce new Rx to OTC switches.
The deal between HUL and Glenmark Pharmaceuticals Ltd. includes acquisition of intellectual property rights, including trademarks, design and know-how related to the VWash brand. HUL will make most of the payment in cash upfront as well as pay a royalty on sales for three years. The companies, however, haven’t disclosed the amount of the deal.
The transaction is subject to compliance with certain conditions and both companies would be working together to complete this in the next few months. Glenmark, however, will continue to manage the business until the transaction is completed, and will also continue to manufacture for HUL for an agreed period of time.
Commenting on the acquisition Sanjiv Mehta, chairman and managing director of HUL said,“The acquisition of VWash gives us an entry into the currently underpenetrated and rapidly growing female intimate hygiene segment. The brand has a leadership position and fits well into the white spaces in our beauty and personal care business. The company is also well positioned to further scale up this business, given the strength of its market development and distribution capabilities.”
According to Glenmark's annual report VWash Plus continues to hold leading position in its category with more than 50 percent market share. Glenmark’s consumer business reported revenue worth Rs 190 crore for financial year ended March 2019, while the VWash franchise alone grew by 48 percent year-on-year during the period.
The acquisition of VWash and Glaxo Smithkline Consumer Healthcare’s health-food drinks business and distribution of its over-the-counter products on behalf of GSK, will give HUL better presence in the health and beauty and chemist channels.