Mumbai, March 23: Colgate-Palmolive Co will buy the Sanex personal care brand in Europe from Unilever Plc for about $940 million even as it seeks to expand in the high-margin personal care business overseas.

Under a swap deal, Colgate will sell its laundry detergent business comprising brands such as Fab, Lavomatic and Vel in Colombia to Unilever for $215 million.

The brand swap arrangement will end some of the embarrassment for Unilever chief executive Paul Polman after he piloted the acquisition of Sara Lee’s international toiletries business in September 2009 for 1.3 billion euros ($1.8 billion).

The brand buyout ran foul of competition laws in Europe.

The competition authorities in Europe cleared the Unilever-Sara Lee deal last November only after the Anglo-Dutch consumer goods giant agreed to put Sanex — the biggest of the Sara Lee brands — on the block.

In a statement Unilever Plc said, “The deal is in response to the European Commission’s requirement that Unilever divest the Sanex brand in the European Economic Area.”

Colgate said the deals were expected to add, on a combined basis, about 4 per cent to total company earnings in 2011.

Colgate chairman and chief executive Ian Cook said, “Sanex is a very strong brand that we have admired for a long time.”

The Sanex portfolio, which covers deodorants and shower gels among other personal care products, had net sales of 187 million euros in 2010, primarily in Western Europe.

Talks of this potential transaction entered the public domain earlier this month.

Procter & Gamble, Henkel, L’Oreal and Johnson & Johnson were also circling the Sanex brand.

It attracted attention from analysts and investors as Sanex was considered as the most sought after brand in the Sara Lee basket.

Industry watchers and analysts said the competition issues raised over the Sara Lee deal had been very embarrassing for Unilever Plc as Sanex had propelled the fast moving consumer goods giant to strike the deal in the first place.

The Sara Lee deal was Unilever’s biggest acquisition since buying Bestfoods in 2000 for $24 billion.

Commenting on the decision to sell Sanex to Colgate Palmolive, Michael Polk, Unilever’s president categories, said: “We are pleased to be divesting Sanex in what we consider to be a very attractive deal for Unilever. At the same time, we are delighted to be adding the Fab, Lavomatic and Vel brands to our portfolio in Colombia. This acquisition will significantly enhance our position in one of the larger detergents markets in Latin America, bringing critical mass to our Colombian business, enhancing our laundry portfolio in the region and further increasing our presence in the fast-growing emerging markets.”

Polman said, “The brands acquired from Sara Lee fill gaps in our current personal care portfolio in Western Europe.”

“The business acquired from Colgate-Palmolive in Colombia will enable us to strengthen our competitive position in laundry in an important region,” added Polk.

Both transactions include the trademarks, intellectual property and formulations but do not include any manufacturing facilities.

In a recent interaction with the media in India, Polman said he was looking at inorganic growth to meet the group’s ambitious growth targets of doubling revenues by 2020.