TTK Healthcare to study Reckitt-SSL deal impact

July 22nd, 2010 - 8:14 pm ICT by IANS  

Chennai, July 21 (IANS) TTK Healthcare will study the impact of Reckitt Benckiser’s acquisition of SSL International on the group, TTK officials said Thursday.
Consumer goods group Reckitt Benckiser Wednesday tied up

Durex condoms and Scholl sandals maker SSL in a $3.8 billion (&pound2.54 billion) deal to integrate it into its personal care division, the company’s fastest growing area.

TTK group officials said the overlap of distribution channels between the Indian arms of the two British companies and their rationalisation will have to be studied first.

SSL International has two joint ventures in India with the TTK group - one that makes Durex and Kohinoor brand of condoms (TTK LIG Ltd) and the other which makes the Scholl range of footcare products (SSL TTK Ltd).

Both the joint ventures, apart from meeting the domestic market needs, also cater to SSL’s global markets.

“SSL and Reckitt do not have any conflicting products in their portfolio. On the other hand, Reckitt will be adding new product categories like condoms to this product portfolio,” said the officials.

Production at the two companies may not be affected because SSL’s change of ownership, but the question that is being asked is on the impact on TTK Healthcare that distributes condoms and scholl range of footcare products.

Reckitt Benckiser sells products like Dettol, Harpic, mortein, Lizol, Cherry Blossom, Vanish, Easy-Off Bang, Veet, Colin, Disprin, Strepsils and Clearsil.

“The distribution may be realigned but the decision will be based on the economies and costs incurred by the respective companies,” a person close to the TTK group told IANS on the condition on anonymity.

“It will take sometime for the new owners to look at India and come down here to discuss the various modalities. Going by the history, the TTK group may even get more products to make here for the global markets,” he added.

According to him, there is no major overlap of outlets selling condoms and footcare products reached by TTK Healthcare and home and personal care products reached by Reckitt Benckiser.

For TTK Healthcare, distribution of consumer products is a loss-making proposition. Last year the company earned around Rs.95 crore and made a loss of Rs.1.52 crore.

When contacted by IANS, T.R. Venkatesh, managing director for TTK LIG and SSL TTK and who also heads the consumer products marketing, said: “All I can say now is no comments.”

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