Mumbai-based Godrej Consumer Products (GCPL) has agreed to sell a portion of its assets in Kenyan hair care company Style Industries Ltd. to a newly formed entity, Hair Manufacturing Kenya Ltd.
The deal involves the transfer of specific assets from Style Industries, including production plants and machinery, office equipment, and inventory.
Style Industries owns the famous “Darling” brand of braids, weaves, and wigs.
According to the Competition Authority of Kenya (CAK), the transaction’s negative public interest concerns, such as job losses, were also noted. CA cited that it will lead to the loss of 652 jobs, equivalent to 30 per cent of the target’s 2,171 employees.
“The transaction qualifies as a merger under the Competition Act No. 12 of 2010, which stipulates that a merger or takeover may occur when an undertaking directly or indirectly acquires control over another business within Kenya,” CAK stated.
CA has approved the transaction with the condition that:
“The approval is conditional upon Hair Manufacturing retaining at least 70% of Style Industries’ employees on favourable terms for 12 months post-transaction,” CAK noted.
These retained employees must be offered employment terms similar to their current contracts.
