Colgate-Palmolive Co. agreed Wednesday to buy the Sanex brand from Unilever PLC for €672 million ($954 million), strengthening its personal-care business in Europe.
As part of the deal, the world's largest toothpaste maker by sales and market share also agreed to sell its laundry-detergent business in Colombia to Unilever for $215 million.
Latin America is Colgate's biggest market by sales.
New York-based Colgate said the sale is in line with its focus on its higher-margin oral-care, personal-care and pet-nutrition businesses.
The company is wrestling with a recent spike in commodity costs that is pressuring a number of industries. Consumer-product companies are raising prices to offset costs.
Unilever, meanwhile, was required to dispose of the deodorant and bath-care-products business to get European Commission clearance of its €1.28 billion purchase of Sara Lee Corp.'s personal-care unit.
Sanex, whose products include shower gels and deodorants, had net sales of €187 million in 2010, primarily in Western Europe.
Colgate said it expects the two deals to increase its earnings by about 4% this year, helped by a one-time gain on the detergent business.
It expects the transactions to boost its profit about 1% in 2012 on growth and cost savings from Sanex.
"We are pleased to be divesting Sanex in what we consider to be a very attractive deal for Unilever," Michael Polk, Unilever's president of categories, said in a statement.
Mr. Polk said the simultaneous purchase of Colgate's laundry brands in Colombia, which include Fab, Lavomatic and Vel, will "significantly enhance our position in one of the larger detergents markets in Latin America, bringing critical mass to our Colombian business."
Both transactions are subject to regulatory approval.
Last month, Unilever posted a profit increase driven by sales gains in emerging markets but also warned that mature economies remain sluggish and escalating commodity prices are pressuring margins.
The Anglo-Dutch maker of Ben & Jerry's ice cream, Knorr soup and Bertolli olive-oil spreads and household products such as Dove, Lynx and Cif is stepping up its investment in the face of intensified competition to build its brands in developing economies.
Unilever derives more than 50% of its revenue from countries such as Asia, Africa, Latin America and the Middle East.
As part of the deal, the world's largest toothpaste maker by sales and market share also agreed to sell its laundry-detergent business in Colombia to Unilever for $215 million.
Latin America is Colgate's biggest market by sales.
New York-based Colgate said the sale is in line with its focus on its higher-margin oral-care, personal-care and pet-nutrition businesses.
The company is wrestling with a recent spike in commodity costs that is pressuring a number of industries. Consumer-product companies are raising prices to offset costs.
Unilever, meanwhile, was required to dispose of the deodorant and bath-care-products business to get European Commission clearance of its €1.28 billion purchase of Sara Lee Corp.'s personal-care unit.
Sanex, whose products include shower gels and deodorants, had net sales of €187 million in 2010, primarily in Western Europe.
Colgate said it expects the two deals to increase its earnings by about 4% this year, helped by a one-time gain on the detergent business.
It expects the transactions to boost its profit about 1% in 2012 on growth and cost savings from Sanex.
"We are pleased to be divesting Sanex in what we consider to be a very attractive deal for Unilever," Michael Polk, Unilever's president of categories, said in a statement.
Mr. Polk said the simultaneous purchase of Colgate's laundry brands in Colombia, which include Fab, Lavomatic and Vel, will "significantly enhance our position in one of the larger detergents markets in Latin America, bringing critical mass to our Colombian business."
Both transactions are subject to regulatory approval.
Last month, Unilever posted a profit increase driven by sales gains in emerging markets but also warned that mature economies remain sluggish and escalating commodity prices are pressuring margins.
The Anglo-Dutch maker of Ben & Jerry's ice cream, Knorr soup and Bertolli olive-oil spreads and household products such as Dove, Lynx and Cif is stepping up its investment in the face of intensified competition to build its brands in developing economies.
Unilever derives more than 50% of its revenue from countries such as Asia, Africa, Latin America and the Middle East.
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