Unilever given the all clear to buy out Kalina as its emerging market push continues

By Andrew McDougall

- Last updated on GMT

Unilever given the all clear to buy out Kalina as its emerging market push continues

Related tags Russia Unilever

Consumer goods giant Unilever could end the year on a high after the Russian Federal Antimonopoly Service granted it permission to acquire Russia’s biggest cosmetics manufacturer, boosting the company’s presence in emerging markets.

Back in October the Anglo-Dutch company announced it had acquired 82 per cent of Concern Kalina for around €500m as it looked to strengthen its Personal Care Portfolio in an attractive emerging market.

Following this approval, Unilever is now expected to offer a buyout to Kalina's remaining minority shareholders within the next six weeks.

Heavy investment in emerging markets

The expected buyout is another emerging market investment by Unilever following a multi-million commitment to expand its factories in Indonesia​ in September this year.

Earlier this year, company CEO, Paul Polman stated that the Kalina acquisition will transform Unilever's personal care business in Russia, giving it leading positions in skin care and hair care, as well as establishing a presence in oral care.

The Russian firm’s brands in skin, hair and oral care, will complement Unilever's own brands such as Dove, Sunsilk, Timotei and Clear.

“It will also strengthen and re-balance Unilever's portfolio and competitive position in Russia, an emerging market with considerable potential and one of our priority countries,"​ said Polman.

Market showing rapid growth

Personal care is a strategic category for Unilever and is one which is showing rapid growth. Ten years ago the segment represented 20 per cent of its Group turnover; however it now accounts for over 30 per cent and occupies a strong position in many of the emerging markets.

Concern Kalina is Russia's largest local personal care player in skin and hair care and has an expected 2011 turnover of around RUB 13 billion (€ 303 million).

Headquartered in Ekaterinburg, where its manufacturing facility is situated, Kalina has an extensive distribution network and sells its products primarily in Russia, Ukraine and Kazakhstan.

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