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Emami appetite for old local brands

Calcutta, May 26: The Rs 2,000-crore Emami Group, which acquired Zandu Pharma for Rs 700 crore last year, is eyeing Bengal’s once-popular brands such as Lakshmi Bilas, Jabakusum and Chesmi.

The company is talking to the families that own these brands.

“I don’t want to name any specific company, but yes, we are in talks with a few firms here,” Emami chairman R.S. Agarwal told The Telegraph.

He declined to set any specific time frame for the transaction given the complex ownership of the old brands.

“There are many heirs. They take time to respond,” Agarwal said.

Emami is hopeful that it will be able to revive the brands as it is doing with Zandu. The Mumbai-based Zandu had great brand recall among customers but it was not doing well. Emami has managed to do a better job with Zandu as it is a strong FMCG player.

But Zandu was much better off than the Bengal brands as it was making some profit when Emami took over.

However, details about these age-old brands and their owners are hardly available.

Lakshmi Bilas was a popular hair oil brand based in the city and was owned by M.L. Bose and Company, headquartered at 61 Park Street. The company stopped production over two decades back due to family issues and problems in the management. Lakshmi Bilas also had a significant presence in Bangladesh.

People who were associated with Lakshmi Bilas said the company had prime properties.

“Many of them might have been sold by the successors,” they said.

Jabakusum is a popular hair oil brand in rural Bengal. The company is based in Calcutta, with offices at 34 C.R. Avenue. The Jabakusum hair oil brand was invented and owned by C.K. Sen & Company. The product is still available in the market.

Chesmi is a popular glycerine soap brand. The company is based in Calcutta and has a good market in rural and semi-urban areas of Bengal.

Emami is willing to spend about Rs 100 crore for the possible buyouts.

A source close to the development said Emami was about to finalise the deal with Lakshmi Bilas.

The recent economic downturn has not affected Emami’s business and it makes sense to acquire small- and medium-sized companies engaged in the same line of business, Emami Group director Aditya V. Agarwal said.

To fund the Zandu acquisition, the company issued non–convertible debentures and borrowed from group companies and promoters — the Agarwal and Goenka families.

Emami — which has recently got approval from its shareholders to sell 15 per cent equity — may consider a stake sale to raise funds for the fresh acquisition, a city-based analyst said.

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