Kalina shares soar on Unilever takeover reports

Image from kalina.org
A report in the Wall Street Journal that it is set to be taken over by global consumer giant Unilever, has seen the share price of Russian skin care products producer Kalina jump more than 35% on Friday morning.

The Wall Street Journal report said that Unilever was set to announce an $850 million dollar buyout, pending last minute snags, as early as Friday. A move by Unilever would add that Kalina range of personal hygiene and care products, which includes Forest Balsam oral hygiene products and Pure Line and Black Pearl body creams, to the existing Unilever lineup which includes globally recognized brands Dove, Rexona, Sunsilk and Ponds.

Russ-Invest analyst, Maria Shishkina was not surprised by the share price leap.

“In principle, there’s nothing surprising in it, as such a share jump is quite a usual thing in Russia’s market. Speculators like to win back on such news, with insiders also being alert –the volumes of the Concern’s share trade increased several times on MICEX even before the deal was announced. But a 40% growth isn’t a limit in our market, as Wimm – Bill – Dann shares, for example, were growing 70% winning back the acquisition by PepsiCo.”

The report referred to Unilever having coveted Kalina for ‘years’ with the Russian company having a 30% share of the face cream, 45% of the mouthwash, and 35% of the hand and body lotion market in the fast growing Russian personal care products sector.Kalina posted a 1H 2011 net profit of 365 million roubles, with an 802 million rouble EBITDA, on the back of sales of 5.496 billion roubles.