P&G sells Wella's local division to Interbrands, its biggest distributor

FMCG giant Procter & Gamble, which is building the world’s largest shampoo plant in Urlati, near Ploiesti, is dropping its local division of professional products designed for hair salons, selling Wella Romania to Interbrands.

Interbrands, which has been distributing P&G products for 17 years, thus takes over distribution of hair dye, shampoos and other Wella hair care products, System Professional and Londa Professional to around 3,000 hair salons, i.e. a company with 12 million euros in sales in 2008 and 70 employees.

The two companies did not reveal the value of the transaction.

Wella does not have production operations in Romania, but P&G is investing in a 100 million-dollar greenfield project, which will allow Head & Shoulders, Pantene, and Wash & Go to be produced on the local market.

These are retail brands, whose shelf price is 3-4 times lower than that of Wella, System Professional, and Londa Professional products, which are distributed exclusively in hair salons.

Wella Romania posted a 12 million-euro turnover in 2008, which amounts to around 4% of P&G’s consolidated business on the Romanian market. Sales of professional players can be put at less than 10-15% of P&G’s Romanian hair care products market. However, Wella is the biggest player on its market segment, of products created exclusively for distribution in hair salons.