Hypermarcas expands in Brazil with three acquisitions

By Simon Pitman

- Last updated on GMT

Related tags: Personal care, Brazil

Beauty and over-the-counter medical provider Hypermarcas is increasing its footprint with the announcement that it is acquiring three new businesses this week.

The Brazil-based company is acquiring two other Brazilian personal care businesses – York, a company that makes feminine hygiene products and Facilit Odontologica e Perfumaria, a maker of oral care products.

Hypermarcas has paid BRL100m ($56.5m) in cash for the purchase of York, which represents up to 100 percent of the outstanding shares in the business, which recorded a turnover of BRL63.3m in 2009.

Feminine hygiene and oral care

As well as feminine hygiene products, York also produces and distributes cotton buds, bandages and other cotton-based products for the domestic market.

Meanwhile, the company will pay BRL79m to acquire the Odontologica business, 60 percent of which will be paid immediately, while the rest will be paid in five other installements.

Odontologica had an estimated sales turnover of BRL62.7m in 2009 and is one of the leading domestic oral care players in Brazil, producing a range of products that include toothbrusesh, dental floss and oral antiseptic treatments.

The two transactions will be subjects to specific terms in the memorandum of understanding between each company, as well as specific legal requirements, due diligence and accounting conditions.

Hypermarcas expands rapidly in Brazil

Hypermarcas has been expending rapidly in recent years and this week the company also announced the acquisition of Luper Industria Farmaceutica, a company that manufactures and distributes branded over-the-counter medical products for approximately BRL52m.

The latest round of acquisitions come in addition to five other companies that were bought by Hypermarcas during the course of 2009, with all eight acquisitions estimated to total an amount in the region of BRL2.5bn.

The company has been targeting increasing household spend in Brazil that has come about after several years of economic prosperity for the country.

Targeting increasing spend on personal care

In turn this has translated into increased spend on personal care products. Most recent market figures show that the cosmetics category in Brazil is continuing to far outpace market growth worldwide.

For the month of December government figures show that month-on-month perfume and cosmetics sales growth was 2.4 per cent, a figure that reinforces predictions that percentage growth for the category could still be well into double figures for the year 2009.

The Brazilian Association of Toiletries, Perfumes & Cosmetics (Abihpec) said that the Brazil market grew at 8.6 percent in 2008 to reach BRL 21.2bn ($8.9bn), a figure that is currently only matched by the Chinese and Indian markets.

Related topics: Business & Financial

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