Consumer products giant Hindustan Lever will retain its oral hygiene business even though parent Unilever is disposing its toothpaste brands in the US and Canada to Church & Dwight.
HLL is a number two player in the Indian oral care market, trailing Colgate-Palmolive, with an average 2002 value share of 34 per cent.
According to HLL, it is committed to participating in the oral care market in India with two power brands, Pepsodent and Close-up.
These brands contribute significantly to HLL's sales and profits and is a strong competitor to market leader Colgate-Palmolive (India), which has a share of 49 per cent.
Close-up was introduced nationally in late 1980s. It created the gel toothpaste segment and has since then garnered a share of 17 per cent.
Pepsodent, the main brand is also a strong player in the Rs 2,000 crore (Rs 20 billion) toothpaste market of India. HLL had withdrawn its low-end brand Aim from the market as part of its restructuring.
As per the global deal, Unilever will receive $104 million in cash at closing, plus additional performance-based cash payments of between $5 million and $12 million.
The sale includes, for the US and Canada, the Mentadent brand of toothpaste and toothbrushes, Pepsodent and Aim toothpaste, and exclusive licensing rights to Close-Up toothpaste.
Unilever, maker of Dove soap to Magnum ice cream added that it remains fully committed to its oral care business outside the US and Canada, where in many markets its brands hold leading or strong positions.
Unilever said the sale is another milestone in Unilever's path to growth strategy, which includes paring down the number of brands in its portfolio regionally and globally, and focusing resources on the company's leading brands.
The focus is on its 400 core brands, which currently account for nearly per cent of the group's turnover.
HLL has also embarked a similar strategy, where it is focusing on 30 power brands. It recently sold its edible oils business as part of its revamp.
