Dabur buys Namaste Laboratories LLC for US $100mn:: Angel Broking

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Dabur buys Namaste Laboratories LLC for US $100mn
Dabur India, through its US-based wholly-owned subsidiary Dermoviva Skin Essentials,
Inc., has bought Namaste Laboratories LLC and three of its subsidiaries in an all-cash deal
for a consideration of US $100mn (~`450cr). Namaste Laboratories is a US-based ethnic
hair care firm with presence in the US and Africa. The deal is likely to close at the end of
CY2010, subject to regulatory formalities and necessary approvals from the US
government. The current management will continue to run the operations.



Namaste Laboratories reported a turnover of US $90mn (~`400cr) and PBT of US
$12.5mn (~`56cr) in CY2009. The deal is, thus, priced attractively at 1.1x sales.
Moreover, the current acquisition marks Dabur’s entry into the fast-growing US $1.5bn
ethnic hair care products market in the US, Europe and Africa. Hence, while we are
enthused with the deal, due to lack of financial details of the newly acquired company, we
have not factored the deal in our numbers. We maintain our current Accumulate rating on
the stock with a Target Price of `106.