Indian giant firms grip on maker of Darling hair brand

An Indian conglomerate has acquired nearly the entire shareholding of popular hair products Darling- and Amigos-maker Style Industries, underwriting the growing importance of the local beauty industry.

Indian firm Godrej Consumer Products said in a statement it had taken an extra 39 per cent stake in Style Industries bringing the total holding to 90 per cent — having acquired 51 per cent earlier.

Godrej, which makes products ranging from soap to beauty products, made the revelation in filings with the Bombay Stock Exchange (BSE) and the National Stock Exchange of India on which it is listed.

“The exchanges are hereby informed that the company through its subsidiary, has increased its stake from 51 per cent to 90 per cent in DGH Phase Two Mauritius, owning Style Industries Limited, Kenya,” said the company.

Style Industries, maker of hair additions including braids, weaves, extensions and wigs, operates from Nairobi and Ruiru, where it employs thousands of people.

Godrej Consumer Products chairman Adi Godrej was quoted in an Indian publication saying the sales in Kenya had been high, making it logical to increase the stake. He added that the company was continuously looking to increase its stake in subsidiaries.

Analysts in India termed the company a “buy” after giving it higher price targets on the two stock exchanges.

The firm, however, did not disclose the price at which it had bought the stake.

DGH has operations in 14 countries in Africa including South Africa and Mozambique. Godrej acquired South Africa’s Kinky Group in 2008 and Mozambique-based hair colour brand Rapidol in 2006.

Godrej also acquired Nigeria’s personal care brand Tura for an undisclosed sum in 2010.

In recent times, the Mumbai-based firm has been on a shopping spree for Kenyan firms in the beauty industry. In February, Godrej purchased a 75-per cent stake in Canon Chemicals, the makers of Valon petroleum jelly in Kenya.

Canon Chemicals had Sh1.2 billion in revenues last year. The chemicals firm is a member of Club 101, which includes companies with an excess of Sh1 billion in annual turnover having participated in the Business Daily-sponsored Top 100 Survey in the past.

Godrej intends to use Canon Chemicals to expand its brands that include air fresheners and baby care products. The Indian manufacturer will also use Canon to expand its products and those of its new partner to other African countries.

READ: Indian firm buys 75pc stake in Valon jelly maker Canon Chemicals

The race to acquire Kenyan beauty product companies has heated up in the past few years. Flame Tree Group made an acquisition in January, in a bid to exploit the regional cosmetics market, which is estimated to be worth Sh23 billion by 2018.

READ: Why Kenya's beauty market is attracting mega takeover deals

In 2013 L’Oreal, one of the top global cosmetic companies, purchased InterConsumer Products, targeting Kenya’s fast-growing lower end of the market, where it had no presence.