Wipro buys a part of personal care brand Yardley for Rs 215 crores
Bangalore: A part of personal care brand Yardley’s business in Asia, Middle East, Australia and north and west Africa has been acquired by Wipro’s consumer care division for about $45.5 million (about Rs 215 crore)
This business was owned by UK-based Lornamead Group, which had bought Yardley from Procter & Gamble in 2005. In the regions that Wipro has acquired the brand for, Yardley has annual revenue run rate of $24 million (about Rs 100 crore). About 70% of this comes from the Middle East and 20% from India.
The brand, first established almost two and a half centuries ago, in 1770, gives Wipro a range of products in the premium end of the personal care segment. Vineet Agrawal, president of Wipro
Enchanteur is priced almost double than Santoor talcum powder ( 100 gm ) which is priced at Rs 36 whereas Yardley is priced at Rs 68. Santoor soap (100 gm) is priced at Rs 18 and Yardley at Rs 40. "Yardley has a strong equity amongst discerning customers and has traditionally been a great gifting brand," Nagender Arya, regional director in Wipro, said.
Wipro’s consumer care revenues grew by 37% in 2008 – 09 to touch Rs 2,083 crore, which is 8% of the It major’s total revenues. The division has an operating margin of 12-13%. Agrawal said Yardley is a profitable brand and could help to take the division's margins higher.
Talcum powder constitutes 40% of Yardley's revenues, deodorants 20%, soaps 14% and perfumes 9%. Arya said Wipro will give a greater push to deos to cater to the younger generation. "We also have a good understanding of soaps. So we'll see if we can manufacture some of that here to avoid duties," he said. Santoor is India's third biggest soap brand, after HUL's Lifebuoy and Lux.
Yardley's business in India is currently small but Wipro plans to use its distribution reach in over 50,000 outlets in metros and class 1 cities to expand the business.
Since 2003 Wipro's consumer care has made five acquisitions, of which Unza’s acquisitions was the biggest, which was at a cost of $246 million. That deal took Wipro into global markets, especially those in South East Asia. Yardley now gives it a strong presence in the Middle East.
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