Shares of Hindustan Unilever opened in positive territory on Tuesday after the fast-moving consumer goods major said it would sell its Pureit water purifier business to a US-based firm.
What Happened: Hindustan Unilever has approved the sale of its water purification business, Pureit, to global water tech company A.O. Smith’s India arm for ₹601 crore, the Indian firm said in a stock exchange statement on Monday.
Hindustan Unilever said this sale aligns with its strategy to focus on core categories.
It was previously reported that this potential sale was being considered as Unilever Plc, the parent company of HUL, initiates the sale of its majority stake in Qinyuan Group, a Chinese water purification equipment manufacturer.
See Also: RITES Wins ₹50 Cr Road Development Order From Assam Govt
Rohit Jawa, CEO and managing director of Hindustan Unilever, expressed confidence that the Pureit brand would thrive under the ownership of A.O. Smith.
The sale will be conducted on a slump sale basis, following the board’s decision to transfer it to A.O. Smith India Water Products.
Parag Kulkarni, president of A.O. Smith India Water Products, noted that the Pureit brand complements A.O. Smith's geographic and channel presence. Kulkarni added that the Pureit team's expertise in consumer needs and water treatment would add significant strength to A.O. Smith in India.
HUL launched Pureit in 2004 in Chennai, expanded nationwide in 2008, and entered the electric water purification segment in 2011.
Price Action: Hindustan Unilever’s share price was up 1.32% at ₹2,654.95 in early trade on Tuesday. The stock has made no gains since the start of the year.
Read Next: Jio Financial Shares Slip 2% After Q1 Print
Don't miss a beat on the share market. Get real-time updates on top stock movers and trading ideas on Benzinga India Telegram channel.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.