Hindustan Unilever Acquires Minimalist for Rs 2,670 Crore

New Delhi, Jan 29 (PTI) FMCG major Hindustan Unilever Ltd has sought clearance from Competition Commission of India to acquire beauty and personal care brand Minimalist's parent company Uprising Science Pvt Ltd.

"The acquirer (HUL) proposes to acquire 90.5 per cent shareholding of the target (Uprising Science Pvt Ltd), with eventual acquisition of the remaining 9.5 per cent shareholding of the target in about two years from the completion date as per the terms set out in the share purchase & subscription agreement executed by and between the parties," said a notice filed with the fair trade regulator CCI on Tuesday.

Hindustan Unilever Ltd (HUL), a leading FMCG player, owns more than 50 brands, including Lakme, Lux, Knorr, Kwality Wall's and Surf Excel.

Jaipur-based Uprising Science is engaged in the manufacturing and sale of beauty and personal care products, baby care and hair care items under the brand name 'Minimalist'.

The proposed transaction is being notified to the Commission under Section 6(2) and Section 5(a) of the Competition Act, 2002, HUL said.

Section 6(2) of the Competition Act pertains to any person or enterprise to notify the regulator before entering into a combination, while Section 5(a) defines a combination as the acquisition of one or more enterprises, or the merger of enterprises that exceed a certain threshold.

In its submission to the Competition Commission of India (CCI) for the assessment of the proposed transaction, HUL said that the transaction will not lead to any adverse effect on market competition. While the relevant market definition has been left open.

While both companies operate in overlapping segments, the transaction is unlikely to alter competitive dynamics significantly, HUL said. The companies have identified key markets relevant to the deal, including the manufacturing and sale of beauty and personal care, skincare, and haircare products in India.

Additionally, the parties (Hindustan Unilever and Uprising Science) have outlined potential vertical linkages and complementarities arising from the deal. These include synergies between the manufacturing and sale of beauty and personal care products and their distribution through beauty salons across India.

The CCI will assess the transaction to determine its impact on competition before granting approval to the deal. The regulatory body examines such deals to ensure they do not harm consumer interests or restrict competition.

Last week, HUL announced that it has signed and executed share purchase and subscription agreement for acquisition of 90.5 per cent of shareholding of Uprising Science Pvt Ltd -- the firm behind Minimalist -- comprising secondary buyout for a cash consideration of Rs 2,670 crore at a pre-money enterprise valuation of Rs 2,955 crore.

The company will also make a primary infusion of Rs 45 crore with an eventual acquisition of the remaining 9.5 per cent of Uprising's shareholding.