Thursday, May 13, 2010

Godrej buys out Sara Lee's stake to become 2nd largest household insecticide player in Asia

The 15 year Joint Venture between Godrej and Sara Lee comes to an end, with Godrej Consumer Products Ltd. (GCPL) buying out its partner's 51% stake for Rs. 1065 crore. Both companies benefit from a break-up at this scenario, US-based Sara Lee wishes to focus on its core food and beverage businesses while Godrej seeks to wholly own shoe polish Kiwi, mosquito repellent Hit and Good Knight which accounts for 1/4th of its net profit.

It seems Godrej had all of it planned since a few years, because GPCL last year bought two units of the Godrej group that together held a 49% stake in Godrej Sara Lee.

Adi Godrej, its Chairman is planning on more acquisitions and is looking ahead to build a war chest of Rs. 3000 crore to fund these mergers in the near future. With its recent Megasari acquisition, it is now the 2nd largest household insecticide player in Asia.

4 comments:

  1. That is the reason the stock price was moving so fast in last couple of days.

    ReplyDelete
  2. Hi,
    Hi,

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    ReplyDelete
  3. Hi Pooja
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    ReplyDelete
  4. When promoters become too overconfident and start buying stakes, it might also show that markets are near their tops. Caution is the watch word.

    ReplyDelete