HUL sells Pureit Water Business to A. O. Smith for ₹601 Crore

16 Jul 2024 , 04:23 PM

Hindustan Unilever Ltd (HUL), a leading FMCG company, announced on Monday, July 15, that its board has approved the sale of its water purification business.

The business will be sold to A. O. Smith India Water Products Private Ltd for ₹601 Crore ($72 million). A. O. Smith India Water Products Private Ltd is a subsidiary of the US-based A. O. Smith Corporation, a prominent global water technology company.

The transaction includes the sale of the ‘Pureit’ brand, encompassing trademarks, copyrights, intellectual properties, and associated assets and contracts. The sale will be conducted on a slump sale basis, as outlined in HUL’s stock exchange filing.

The water purification business is part of HUL’s Home Care segment and generated a turnover of ₹293 Crore in the financial year 2023-24, representing less than 1% of HUL’s total turnover.

At the time of writing on July 16, 2024 at 4:18 pm, shares of Hindustan Unilever Ltd (HUL) closed at ₹2684 which is a 2.44% gain than the previous close. Hindustan Unilever Ltd (HUL) stock has gained a total of 0.09% in the last one year and 1.11% since the beginning of the year.

HUL does not separately track the net worth of the water purification business. The sale will not impact HUL’s shareholding pattern.

HUL will continue to manage the water purification business until the completion of the transaction, which is subject to customary closing conditions.

HUL’s CEO and Managing Director, Rohit Jawa, stated that the sale aligns with the company’s strategic focus on core categories.

Rohit Jawa expressed confidence that the ‘Pureit’ brand, known for its essential water purification solutions, will thrive under A. O. Smith’s ownership.

Parag Kulkarni, President of A. O. Smith India Water Products Private Limited, praised the ‘Pureit’ brand for its innovative products and strong brand recognition.

Kulkarni highlighted that ‘Pureit’ complements A. O. Smith’s geographic and channel presence. He also emphasized the value of the Pureit team’s expertise in consumer needs and water treatment, expressing enthusiasm about welcoming them to the A. O. Smith family.