Reckitt Benckiser Group has signed a deal with Primavera Capital Group to sell its Chinese baby-formula business. The is worth around USD 2.2 billion. Reckitt Benckiser took the decision as it was looking for an option to exit the struggling sector. The company is expected to retain an 8 per cent stake in the unit. After costs, the consumer goods group is expected to receive around USD 1.3 billion. The company said in a release that it plans to use the money to reduce debt. The company expects a net loss of around USD 3.5 billion on the sale of its baby formula business. The loss will primarily because of the remeasurement of goodwill and intangible assets. The consumer good company had purchased the business in 2017. The purchase was part of the deal to acquire American baby milk group Mead Johnson. As part of the deal, the company had then paid around USD 16.6 billion. Now the company had decided to sell most of the Chinese division to Primavera.
According to people aware of the development, the deal is expected to be finalized in the second half of the year 2021. With this, the curtain comes down on Reckitt’s venture into the baby-formula business. The timing of Reckitt’s entry into the industry coincides with the starting of the struggle for the sector. Under the deal, Primavera Capital will also take over the manufacturing plants in Nijmegen, the oldest city in the Netherlands, and China’s Guangzhou. The deal will also give the company exclusive license to brands like Mead Johnson and Enfa in China. However, Reckitt will continue to the owner of the company and the brands will be operated by it in other parts of the world.
Reckitt had purchased the business in 2017. Three years later, the infant-nutrition business in Greater China was put under strategic review by the company. This was done as part of the biggest portfolio revamp by chief executive officer Laxman Narasimhan, who took over the post in late 2019. The company saw an overall growth in sales, around 12 per cent in 2020, under his leadership. This was mainly because of the surge in demand for hygiene products. But the baby-milk business in China remained an underperformer. China for long has been one of the biggest markets for baby products. But the country has lost the allure because of the sharp decline in birth rates.
The global heat transfer fluid market is poised to grow at a CAGR of 5.6%…
The Calcium Hypochlorite market is poised for substantial growth, projected to reach around USD 2317.9…
The Sodium Metabisulfite Market is poised for significant growth, with a projected value of USD…
activated alumina market size is expected to be worth around USD 1724 Million by 2033, from USD 1018.9 Million…
The bio fungicides market is poised for significant growth, with projections indicating a valuation of…
The hydrogen generation market is forecasted to see substantial growth, reaching USD 489.2 billion by…
The Hydrogen Peroxide Market, valued at USD 3.2 Billion in 2023, is projected to exhibit…
The global bauxite market exhibited significant value and growth trends over recent years. In 2022,…
The aerogel market has demonstrated significant growth, with its valuation reaching USD 876.5 million in…
biobased disinfectant market size was valued at USD 4.5 Billion and it is estimated to reach USD 8.7 billion…
The Concrete Sealer Market is poised for substantial growth, with projections estimating its value to…
The Ammonium Sulfate Market is poised for significant growth, projected to reach approximately USD 6.1…
The cathode material market, integral to advancements in battery technology, has been valued at USD…
The flat glass market, known for its essential role in various industries, is on a…
The Special Graphite Market, valued at USD 785.5 million in 2022, is projected to reach…
The Black Pellets Market is poised for significant growth, with a projected Compound Annual Growth…
The nanosized alumina market, valued at $3.0 billion in 2022, is expected to grow to…
The global methanol market is on a robust growth trajectory, with projections indicating a rise…
The E-Liquids market is set to experience remarkable growth, with a projected Compound Annual Growth…
The PVC market is anticipated to achieve a substantial valuation of USD 94.7 billion by…