China cosmetics maker branches out into baby gear as two-child policy takes effect

By Lucy Whitehouse

- Last updated on GMT

China cosmetics maker branches out into baby gear as two-child policy takes effect
Shanghai Jahwa, a leading Chinese cosmetics group, has agreed the acquisition of British baby bottle brand Tommee Tippee, in a move which will enable the beauty player to respond to the expected rise in demand for baby items.

The company explained that the USD 197 acquisition will allow it to develop its innovation capabilities, taking on research and development expertise from the newly acquired brand.

Mayborn [Tommee Tippee parent company] enjoys great reputation and regard among the peers, given its stable sales performances and strong R&D capabilities​,” Jahwa reportedly said​.

More children, more opportunity

The domestic cosmetics player, which owns many popular brands including Herborist and Maxam and has never before acquired a non-cosmetics company, explained the shift in strategy.

"Following China's new policy that encourages married couples to have two children as against one in the past, we are bullish on the long-term growth of the baby products sector in the China market​," Jahwa stated.

China changed its one child policy effective from this January in light of the ageing population in the country, allowing couples to now have two children. Jahwa’s response suggests companies are being quick to adapt to the opportunities created by the change in law.

Branching out

The acquisition indicates Jahwa is keen to make a decisive change in direction from its traditional sole mainstay of beauty, and position itself as a wider-reaching FMCG player.

“The acquisition is a combination of strengths,” ​the company explained. “The two sides will be able to create an international business platform of baby care products.​”

Jahwa isn’t the only company in China taking steps to diversify its product offering and range, according to industry commentators.

Jahwa's move is part of an ongoing trend by Chinese companies acquiring premium foreign consumer brands, expanding their businesses overseas and bringing high-quality foreign products to China​,” explains a report by China Daily.

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