Wipro buys some Yardley operations for $45.5 mn

Wipro buys some Yardley operations for $45.5 mn

Bangalore: Wipro Ltd has acquired some businesses of Yardley for about $45.5 million from British personal care company Lornamead to boost its consumer care unit’s presence in the overseas markets.

Wipro, which gets about three quarters of its revenue from IT services, said on Thursday it had bought Yardley business in Asia, west Asia, Australasia and some African markets.

“These are developing countries and we wanted to have a stronger presence in these places and that’s why we looked at this acquisition," Vineet Agrawal, president of consumer care and lighting unit of Wipro, told reporters.

The transaction is expected to be completed by mid-December and revenue from the acquisition would start flowing from the March quarter, he said, adding the acquired business currently has revenue of $24 million a year.

The acquisition would be accretive to the Wipro consumer care unit’s profit margins, Agrawal said, without giving details. The unit contributes about 9% of Bangalore-based Wipro’s total revenue.

“From margins perspective and revenue perspective, it’s a good buy," he said.

New York-listed Wipro, majority owned by billionaire chairman Azim Premji, had acquired Singapore’s Unza Holdings, which makes personal care products, for about $246 million in 2007 to expand its consumer care product portfolio.

Analysts said the Yardley business purchase would not have a significant impact on Wipro’s financials in the near term. “It’s not that big an event for Wipro," said Tejas Doshi, head of research at Sushil Finance in Mumbai.

“But it clearly shows that they are focused on this business and want to increase its share within the overall business."

Shares in Wipro, which has a market value of $18 billion, were down 0.8% at Rs591 by 2.10 pm in the Mumbai market that was down 0.3%.