The $7.6-bn Estee Lauder Group has acquired a minority stake in Delhi-based Forest Essentials, a fledgling ayurvedic skin, body and haircare product maker.
This will help Estee Lauder strengthen its foothold in the expanding Indian beauty market. It will give Forest Essentials products access to the global markets. Though the company officials declined to divulge details, according to sources, almost 10-15% of equity has been offloaded.
“India is a very important market for Estee Lauder and with this agreement we hope to expand our competitiveness in the natural products arena,” Estee Lauder senior vice-president (international business development) Daniel Rachmanis said.
The world’s leading skincare product manufacturer will be bolstering Forest Essentials’ retail expansion and brand building in India, and also take it outside India.
Forest Essentials, which has seven stores, plans to open 35-40 more retail outlets by 2010 and a production unit in Uttarakhand. It’s also planning a factory in Haridwar within the next two months. The company plans to invest Rs 15-20 crore in these initiatives.
“We are bullish about our international presence. With Estee Lauder’s integrated backward expertise, we expect to meet international standards for indigenous products,” says Forest Essentials CEO Mira Kulkarni. The company has grown 100% in the last three years and expects to maintain the same growth rate over the next two years.
Taking forward the wellness plank, Forest Essentials is planning its own spa in the next couple of years. It already supplies spa products to hotel chains such as Taj Luxury, Grand Intercontinental, The Hyatt Regency, Radisson and ITC, to name a few.
Estee Lauder Group, that started selling its products in India in 2005, currently sells six brands in India, including MAC, Tommy Hilfiger, Donna Karan, Aramis and Clinique.
Source: Economic Times