Essity sold the Russian business to the co-owner of EMC Igor Shilov
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Igor Shilov, the co-owner of the European Medical Center (EMC) network, the founder of the Nidan juice producer, Igor Shilov, became the buyer of the Russian business of the Swedish personal care products supplier Essity. In a deal worth about 10 billion rubles. should include three factories and the rights to the Zewa, Tork, Libresse and Tena brands for a certain period. Enterprises have opportunities for further development, given the high level of localization of production, experts say.
The Swedish manufacturer of personal care products Essity sold the Russian business of New Technologies LLC to Igor Shilov, co-owner of the European Medical Center (EMC) network, reported Essity July 17th. The cost of the transaction is 1.2 billion Swedish kronor, or about 10 billion rubles. at the current exchange rate of the Central Bank, the assets were paid in cash, without borrowing, the report says. In 2022, Russia accounted for about 2% of Essity’s net revenue. In 2022, the revenue of Essity LLC decreased by 10.3%, to 28.34 billion rubles, net profit was 3.61 billion rubles. EMC and Russian Essity did not provide operational comments.
In Russia, Essity produces hygiene products under the brands Zewa, Tork, Libresse and Tena. According to his own data, he manages two factories in the Tula region and an enterprise in the Leningrad region. After the outbreak of hostilities in Ukraine in April 2022, Essity announced about leaving Russia due to “deteriorating business conditions”, and in June of this year announced the signing of an agreement on the sale of Russian assets.
Igor Shilov is known as one of the founders of Nidan, a major juice producer. At the end of 2006, the company’s share in the Russian market was estimated at 18%, and Kommersant’s sources spoke of PepsiCo’s interest in buying Nidan. In 2007, Mr. Shilov, who owns 55% of Nidan, sold with the rest of the shareholders more than 75% to the British fund Lion Capital for $530 million. And in 2010, Nidan bought out Coca-Cola.
The EMC network includes six multidisciplinary medical centers, a pediatric complex, a rehabilitation center, and a geriatric center. In 2021, according to Forbes, EMC became the second clinic chain after Mother and Child to conduct an IPO, during which EMC was valued at $1.1 billion. In 2022, EMC’s revenue grew by 12.4%, to € 326.3 million, net profit was €45 million.
According to two Kommersant sources familiar with the deal, the new owner of Essity’s Russian assets is likely to receive the right to use all brands present on the local market for a certain period.
For Igor Shilov, the purchase will be a separate investment, not related to EMC, the interlocutor of Kommersant notes. Dmitry Gabyshev, Managing Director of Peregrine Capital, also believes that this is rather a separate business, but he admits synergy with EMC in terms of expanding the sales channel to the b2b segment.
Petr Bobrovsky, Executive Director of the Association of Manufacturers of Perfumery, Cosmetics, Household Chemicals and Hygiene Products, calls Essity a significant player in the segment of sanitary and hygienic products. According to him, the Russian division has opportunities for further development in the market after the sale of the business, given the high level of localization. At the end of 2022, Essity announced the launch of local production of more than 70 new Tork and Zewa articles and reduced dependence on imported raw materials.
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