Wipro acquires South African personal care company

The consumer care business of software provider Wipro Ltd, Wipro Consumer Care and Lighting (WCCL), acquired Canway Corporation, a South African personal care maker to enter the country with 58 million consumer base.

Canway Corporation, a Durban-based company is US$ 21 million personal care company having portfolio in category including bath and shower, hand cream, body spray and kids' products and markets mass brands such as Oh So Heavenly, Iwori and IQ.

The deal size of the transaction was not disclosed by the companies and is now subject to the approval of regulatory authorities.

The acquisition will act as an opportunity for Wipro Consumer to enter into South Africa which is the largest personal care market in Africa and is the second largest economy of the continent.

"We are clear that we want a footprint in developing countries where we have a headway and penetration and consumption goes up. South Africa is a developing country with a per capita income of US$ 6300, which is three times that of India. Canway has grown double digit over the years. It gives us a tremendous base," said Mr Vineet Agrawal, chief executive at WCCL.

The company already has a small presence in South African market with its flagship soap brand Santoor. The company plans to evaluate its launch in India, after this deal, in terms of appealing packaging, perfume parameters and gifting by February.

The company had acquired Philippines’ personal care maker Splash Corporation for US$ 80 million in April. The acquisition of Singapore’s Unza Holdings in 2007 of worth Rs 1000 crore was the company's largest deal.

"We have spent US$ 950 million over the last 17 years on 12 acquisitions. This is the first time that WCCL has made two acquisitions this fiscal. The geographies are different, and we are equipped to handle two acquisitions in a year now."

After this deal, WCCL now has presence in India, South Africa, China, Malaysia and Philippines. The sale from international business accounted for nearly 51 per cent of Wipro Consumers' annual sales of a billion dollar in 2018.

"Post the Philippines acquisition in Splash in April, we roughly earned 54 per cent of our business from overseas. Since this deal is relatively smaller, we will remain at the same value," Mr Agrawal added.

The company plans to expand its presence in the markets of Africa, Asia, and Eastern Europe.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.