SHOP TALK: Baby, baby, baby
Durex owner Reckitt Benckiser's baby formula deal set to capitalise off China's expected population growth since the one-child policy was terminated
Chances are you’ve used a Reckitt Benckiser brand: Gaviscon, Strepsils or Clearasil, that great staple of teenage angst. The British consumer goods giant did a bout of schizophrenic dealmaking last week, buying Mead Johnson Nutrition for US$17.9bn (including debt). That company makes baby formula. Did I mention that Reckitt is also the owner of the condom brand, Durex. No-one put it better than Ritholtz Wealth Management CEO Josh Brown: “Now that’s a hedge.” After Nestlé and Danone, Mead is the third-largest infant nutrition company in the world, with roughly 10% of global market share. It’s a spin-off of pharma player Bristol-Myers Squibb and has been on Reckitt’s radar for a few years, apparently. The company is calling it a natural extension of its health portfolio. (Naturally) there’s more to it.China, the fastest growing paediatric nutrition market globally, now becomes the combined company’s second-largest market by sales. From medicine to clothing to food, babies are about to...
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