Godrej buys out Sara Lee stake in joint venture

Godrej Consumer Products Ltd on Wednesday announced that it has acquired the remaining 51-per cent stake in Godrej Sara Lee Ltd, owned by its joint venture partner Sara Lee Group.

The acquisition further consolidates GCPL`s position in the Indian fast moving consumer goods space, making it the largest Indian home and personal care portfolio in India after the MNC`s.

Godrej had indicated its hopes of buying out the US firm's stake in the Indian venture (See: Godrej keen to acquire majority stake in JV with Sara Lee)

In a separate statement from San Francisco, Sara Lee Corp also announced that it was selling its 51-per cent stake in the joint venture, which markets insecticides in India, to GCPL. The transaction is expected to close by July 3, Sara Lee said.

Commenting on the acquisition, Adi Godrej, chairman of the company said, ''The acquisition represents an important step towards GCPL becoming a leading emerging markets multinational and dovetails well with our global 3 by 3 strategy - presence in three emerging continents - Asia, Africa and Latin America through three core categories - home care, personal wash and hair care.

Over the last few years, we have been following a very disciplined and focused approach to identify acquisitions that represent a strong fit with our business, both strategically and operationally.''

The joint venture's revenue was around Rs750 crore in fiscal 2009, Sara Lee said. That business accounts for some 9 per cent of the adjusted operating segment income for Sara Lee's international household and body care business, it added.

Sara Lee, whose businesses include Hillshire Farm lunchmeats and Sara Lee bread, has been focusing on its main food and beverage businesses as it remakes its portfolio. It is slated to sell its European body-care business to Unilever and parts of its Ambi Pur air freshener business to Procter & Gamble Co.

Godrej is one of the largest marketers of consumer products in India.