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Unilever To Buy Controling Interest in Concern Kalina

To pay $688 million for 82% stake in Russian cosmetics maker.

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By: TOM BRANNA

Editor

Unilever is a leader in emerging markets and it continues to expand its empire BRIC by BRIC. The maker of such well known brands as Dove, Lux, Axe and Pond’s, agreed today to purchase 82% of Concern Kalina for21.5 billion rubles ($688 million). When the deal is completed, Unilever will issue an offer to acquire the remaining shares in the company.

According to Unilever, Concern Kalina is Russia’s biggest local personal care player with leading positions in skin and hair care and expected 2011 sales of $417 million. Its headquarters and manufacturing site are located in Ekaterinburg, where its manufacturing facility is situated. The company has a strong, extensive distribution network and sells its products primarily in Russia, Ukraine and Kazakhstan. It employs around 1,900 people.

“We are delighted to be acquiring Concern Kalina. This will transform Unilever’s personal care business in Russia, giving us leading positions in skin care and hair care, as well as establishing a presence in oral care,” said Paul Polman, CEO, Unilever. “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.”
Specifically, the transaction enhances Unilever’s presence in an attractive, high-growth market with a differentiated portfolio which has grown at above market rates in competitive categories; adds to Unilever’s portfolio successful, authentic Russian brands in skin care, hair care and oral care like Pure Line, Black Pearl, Silky Hands, 100 Recipes of Beauty and Forest Balm, complementing Unilever’s own brands such as Dove, Sunsilk, Timotei and Clear; provides Unilever with the opportunity to use its technology to take these brands to a new level.
On completion Unilever intends to launch a Mandatory Tender Offer to acquire the remaining shares that are not part of the initial agreement, at such time and on terms mandated by Russian law.

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