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Unilever purchases soap brands to get a better foothold in "priority market" Mexico

2 min read

29 December 2014

Unilever recently announced the purchase of two soap brands owned by rival Procter & Gamble (P&G). Brands Camay and Zest, as well as a Procter & Gamble soap manufacturing facility, are all part of the company's plan to grow in Mexico, which has been deemed a “priority market”.

This move comes after P&G’s announcement that it will shed up to 100 brands around the glove over the next two years. CEO AG Lafley said the strategy would create a “more streamlined” P&G “that will continue to grow faster and more sustainably, reliably create more value”.

The brands together had a turnover of $225m in the last fiscal year. The transaction, for an undisclosed amount, is expected to close during the first half of 2015 subject to necessary regulatory approvals.

In terms of the manufacturing facility in Mexico, the plant employs approximately 170 people who will transfer to Unilever at the completion of the deal.

“We are excited about the acquisition of Zest and Camay,” aid Alan Pope, president of Unilever Personal Care. “They represent an excellent strategic fit for us and will further strengthen our global position in skin cleansing.

“The brands will benefit from our innovation and R&D capabilities. They will make us one of the market leaders in skin cleansing in Mexico, a priority market for Unilever and one of the largest markets in the world.”

Indeed, according to the government, “demand for personal care products in Mexico has steadily increased over the past decade due to the rise of the purchasing power of Mexican consumers and to an increased access to different types of credit that have
allowed Mexicans access to better quality products and have increased the demand.”

Mexico is one of the biggest markets for personal care products in Latin America. And Mexican Chamber of the Cosmetics Industry statistics suggest that the market is extremely competitive as most of the largest international brands compete for market share

With the biggest segment in personal care being hair care, followed closely by skin care, Unilever is looking to push its rivals aside.

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