Consumer products giant Unilever today received the European regulator's approval for its €1.2-billion ($1.76 billion) acquisition of the personal care business of the Sara Lee Corporation after agreeing to divest Sara Lee's Sanex brand in Europe.
The approval ended a year-long scrutiny of the deal by the Brussels-based European Commission (EC) after it had extended its review in June 2010 to October 2010.
In September 2009, the UK and the Netherlands listed Unilever had made a binding offer to acquire the bodycare business of the Sara Lee for €1.275 billion ($1.88 billion) in cash to expand its portfolio in Western Europe and Asia. (See: Unilever to acquire Sara Lee personal care business for $1.88 billion)
The dollar and the euro have fallen since the time the proposed transaction was announced late last year, reducing the size of the deal to €1.2 billion or $1.76 billion.
The EC's prime concern was that Sara Lee's Sanex brand would make Unilever a market leader in some European countries and remove competition for deodorants, skin cleansing and fabric care products since Unilever's products Axe, Dove and Rexona brands were in the same category as Sanex brand.
The EC felt that this would lead to Unilever holding a monopoly in this category and the company would raise prices for these brands in Belgium, the Netherlands, Denmark, Britain, Ireland, Spain and Portugal.