Emami is keen to acquire Henkel AG's 51 per cent in Henkel India, the consumer goods maker, even as Jyothy Labs bagged a 14.9 per cent stake in the company.
"Emami has maintained it is interested in buying a 51 per cent stake in Henkel India. We are evaluating the situation and are still in race for the company and not going to backtrack. As far as the development is concerned, we are in a wait-and-watch mode," said Harsh Agarwal, Director, Emami.
According to experts, the strong presence of Henkel India in Eastern India, in terms of reach, as it had acquired Calcutta Chemical Company almost a decade before, is prompting Emami to go ahead with the bidding.
Jyothy Labs became the frontrunner in the race for a majority stake in Henkel India last week, by buying 14.9 per cent of the 16.7 per cent stake held by Spic chairman A C Muthiah's Tamil Nadu Petroproducts Ltd (TPL) for Rs 60.7 crore (Rs 607 million).
Now, it is the the largest Indian shareholder in Henkel India. This could affect the interest of other bidders such as Emami, Godrej and Wipro Consumer, as Jyothy's holding was just below the mandatory open offer mark of 15 per cent.
HSBC was given the mandate to sell Henkel India's brands such as Margo soap, Neem Active toothpaste and Chek detergent - brands that Henkel acquired from the erstwhile Calcutta Chemical Company almost a decade before.
A long-term licensing of international brands Henko, Pril and Fa was also on offer as the $17-billion German conglomerate wanted to exit both laundry and personal care segments in India.
"The acquisition really makes sense for Emami as these brands perfectly suit their portfolio. Moreover, Henkel has got a strong reach across the country with more than 750 distributors and specially in Eastern and Southern parts.
In the South, they have a strong base and good manufacturing facilities. Hence, I don't think that Emami will backtrack from this," said Chitrangada R Kapur, an analyst with Angel Broking.
