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Kimberly-Clark to acquire Softex Indonesia for $1.2 billion

Christian Fernsby |
Kimberly-Clark Corporation has entered into a definitive agreement to acquire Softex Indonesia in an all-cash transaction for approximately $1.2 billion from a group of shareholders including CVC Capital Partners Asia Pacific IV.

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Indonesia is a large, growing market with attractive future prospects, and the acquisition immediately improves Kimberly-Clark's currently limited position in the country to one with strong market share in key personal care categories across Southeast Asia's largest economy.

The diaper market in Indonesia is currently estimated at $1.6 billion, the sixth largest in the world, with approximately five million annual births.

Approximately 80 percent of Softex Indonesia sales come from diapers, and it currently holds the number two market share position with the Sweety and Happy Nappy brands while continuing to grow its market presence.

The remaining Softex Indonesia sales are mostly in the feminine care and adult care categories. In feminine care, the company holds the number three market share position with the Softex brand. In adult care, it holds the number two market share position with the Confidence brand. Softex Indonesia generated net sales of approximately $420 million in 2019.

Excluding one-time transaction and integration costs, the acquisition's impact on adjusted earnings per share in 2020 and 2021 is expected to be immaterial. The transaction will be financed primarily through incremental debt and secondarily cash on hand.

The transaction is expected to close early in the fourth quarter of 2020 and is subject to customary closing conditions.

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