AO Smith Corporation expects to complete the acquisition of Pureit by the end of 2024
New Delhi: Hindustan Unilever Ltd. on Monday announced the sale of its water purification business under the Pureit brand to AO Smith India Water Products for $72 million (about Rs 600 crore) as part of a global transaction by its parent Unilever.
Globally, Unilever said it has agreed to sell its water purification business Pureit to AO Smith, a leading global water technology company.
Pureit offers a range of water purification solutions across India, Bangladesh, Sri Lanka, Vietnam and Mexico, among others.
In a statement, AO Smith Corporation said the purchase price will be approximately $120 million in cash, subject to customary adjustments, and it expects to complete the acquisition of Pureit by the end of 2024.
“The board of directors at their meeting held on July 15, 2024, has approved the sale and divestment of company’s water purification business carried under the brand ‘Pureit’, including the trademarks, copyrights and other intellectual properties and identified assets and contracts associated with the business, as a going concern on slump sale basis to AO Smith India Water Products Pvt Ltd,” Hindustan Unilever Ltd (HUL) said in a regulatory filing.
On the consideration received from the sale, HUL said it is being carried out at an enterprise value of $72 million (about Rs 600 crore), subject to permissible adjustments as per the transaction.
In 2023-24, the turnover of the water purification business proposed to be sold was Rs 293 crore, less than 1 per cent of HUL’s turnover, it added.
The water purification business is part of the overall home care segment, and its net worth is not separately tracked by the company, HUL said.
“This move is in line with our strategic intent to focus sharply on our core categories. Pureit provides essential water purification solutions to millions of loyal consumers, and I am confident the brand will thrive further under the ownership of AO Smith,” HUL chief executive officer and managing director Rohit Jawa said.
On the acquisition, AO Smith India Water Products President Parag Kulkarni said, “The Pureit brand, known for innovative water purification products, strong brand recognition and dedication to customer service, complements AO Smith’s geographic and channel presence”.
The Pureit team’s deep understanding of consumer needs and water treatment expertise adds tremendous strength to AO Smith in India, he added.
The transaction is subject to customary closing conditions, and HUL will continue to manage the business until the completion of the transaction, the filing said.
In a separate statement, Unilever President Home Care Eduardo Campanella said, “The sale of Pureit marks another milestone on our journey to evolve our portfolio towards higher-growth spaces, in line with our Growth Action Plan”.
AO Smith Chairman and CEO Kevin J Wheeler said, “We believe the addition of Pureit will strengthen our leadership position as a global supplier of premium water treatment products and double our market penetration in South Asia”.
He further said, “The acquisition will also support our corporate strategy by enhancing our premium product portfolio and distribution capabilities.
Pureit’s culture of innovation, strong brand recognition and dedication to customer service will be an excellent addition to our premium brand positioning and broad product portfolio in the region”.
