The hygiene and health company Essity has reached an agreement to acquire approximately 44% of the Colombian company Familia S.A. After the closing of the transaction, the ownership of Essity en Familia will amount to at least 94%.

Essity has owned Familia since 1985 and currently owns 50% of the company. The purchase price amounts to $1.54 billion for 100% of the debt-free company.

"Familia is an innovative and consumer-focused company. Our strong relationship dates back more than 30 years. With this acquisition we are building a stronger platform in Latin America to increase growth, profitability and efficiency, as well as accelerate digital transformation," says Magnus. Groth, President and CEO of Essity.

Familia is headquartered in Medellin, Colombia, with a strong presence in Latin America. The company operates mainly in personal care, and also in consumer fabrics and professional hygiene. Familia is already consolidated in Essity's accounts and recorded sales in 2020 of around €825 million equivalent to an adjusted EBITA margin of 16.8%. Organic sales growth in 2020 was 2.8%. The acquisition is expected to increase Essity's earnings per share starting in 2021.

In Colombia, Familia is a market leader in Feminine Care with the Nosotras® brand, Incontinence Products with the TENA® brand and Consumer Tissue with the Familia® brand.

Net sales divided in 2020 by category were Female Care 38%, Consumer Tissue 31%, Baby Care 13%, Incontinence Products 11% and Professional Hygiene 7%. The most important countries are Colombia and Ecuador, with respectively 50% and 21% of net sales in 2020. Familia has approximately 5,000 employees and eight production plants.

The acquisition will be financed entirely by debt and Essity has established committed credit lines. Essity remains fully committed to maintaining a strong investment grade rating.

Completion of the transaction is subject to customary regulatory approvals and is expected to be completed in the second half of 2021.