From the Sector

Ontex Group NV, a leading international developer and producer of personal care products, announces that it has completed the divestment of its Brazilian business activities to Softys S.A., a personal hygiene company with operations across Latin America and a wholly-owned subsidiary of Empresas CMPC S.A., headquartered in Chile.

The transaction includes Ontex’s business in Brazil and its manufacturing facility in Senador Canedo in the State of Goiás. The business develops, manufactures, commercializes and distributes diapers and pants for the baby care market under the PomPom, Cremer, Sapeka and Turma da Mônica brands, as well as for the adult care market under the Bigfral brand. It employs approximately 1,400 employees.

Gustavo Calvo Paz, CEO of Ontex, said: “Reaching this milestone allows us to focus further on our retailer brands and healthcare in Europe and North America, where we have significant growth drivers for the future. Moreover, the proceeds from the sale will further reduce our indebtedness, putting us in an even stronger position to further execute our transformation. I am convinced that Softys is well placed to take the business forward, enabled by the talent and expertise of our teams.“

Aggregate net cash proceeds received at closing, net of cash/debt disposed, are €81 million, after the impact of tax-related and transaction costs, hedging expenses, as well as provisional balance sheet adjustments. On top of this amount, €18 million* will be put in escrow at closing.  The divestment proceeds will be used to reduce Ontex’s outstanding gross financial debt further.

Ontex Group NV, a leading international developer and producer of personal care solutions, announces the commercial launch of its Dreamshields® technology for baby diapers. Offering superior performance, all-round leakage protection, and enhanced comfort, Dreamshields® ensures optimal dryness while prioritizing sustainability. The Dreamshields® technology is now available on shelf in several European markets in Europe, and being rolled out to more customers soon.

Dreamshields® technology integrates a range of advanced features that benefit both parents and babies, enhancing comfort, protection, and ease of use. Consumers have responded positively to the innovative technologies. Panel scores show Dreamshields® performs great, especially when it comes to  leakage protection. These innovations address both the needs of babies for comfort and the expectations of parents for reliability and sustainability:

• Channel design with gender-specific zones: enhances fast liquid flow across the entire core for superior absorption, ensuring babies stay dry and comfortable.
• SeconDRY® system: provides instant dryness by rapidly drawing moisture away from the skin, minimizing the risk of irritation
• Double-layer core with dual SAP (Super Absorbent Polymer): features two types of SAP, optimizing fast liquid attraction and solid retention for a lighter, more flexible diaper.
• 360° protection: combines front and back barriers with anti-leak cuffs, effectively preventing leaks and blow-outs in all directions.
• Heat release feature: promotes air circulation, maintaining fresh and healthy skin conditions to prevent discomfort and rashes.
• High waist fit: offers a snug and stretchy fit that adapts to baby’s movements, ensuring comfort at all times.

Ontex Group NV (Euronext: Ontex), international developer and producer of personal care products, announced a binding agreement to sell its Brazilian business activities to Softys S.A. for an enterprise value of BRL 671 million (or approximately €110 million*).

Softys is a personal hygiene company with operations across Latin America, that also acquired Ontex’s Mexican business activities in 2023. It is a wholly owned subsidiary of Empresas CMPC S.A., which is headquartered in Chile.

The transaction includes Ontex’s business in Brazil and its manufacturing facility in Senador Canedo in the State of Goiás. The business develops, manufactures, commercializes and distributes diapers and pants for the baby care market under the PomPom, Cremer, Sapeka and Turma da Mônica brands, as well as for the adult care market under the Bigfral brand. It has approximately 1,400 employees and contributed revenue of €97 million and adjusted EBITDA of €13 million to the Group in the first half of 2024.

Subject to customary balance sheet adjustments, the net proceeds of the transaction, after deduction of tax-related payments and transaction fees, are expected to be approximately €82 million*, of which up to €18 million* will be held in escrow. The transaction will generate a net gain on disposal of approximately €39 million* and trigger the recognition of a non-cash accounting loss of approximately €(140) million* related to the accumulated currency translation reserves.

Ontex and Softys aim to close the transaction, which is subject to customary conditions, including merger clearance from the Brazilian antitrust authority, during the first half of 2025.

Ontex Group NV announces the launch of enhanced youth pants this fall. The pants are designed to reduce the psychological impact of incontinence during adolescence, offering protection and discretion.

The new Ontex youth pants are tailored for children aged 3 to 15 who struggle with bladder control at night, despite staying dry during the day, or have some disability leading to loss of bladder control.

The pants are produced by Ontex plants using its growing HappyFit product platform and will be available through retailers and Ontex’s online sales channels in Europe, with room for expansion to other regions. The pants are constructed combining absorbent materials for heavy bedwetting protection, a chassis with soft and quiet materials for discretion that also offers an improved fit. The production will also have a significantly lower impact on the environment vs previous concepts. During the production, waste is also minimized.

Bedwetting is a common issue, affecting many children. Research^[1] shows that 15% of children still wet the bed in primary school, with boys significantly more likely to experience incontinence. Bedwetting mainly occurs at night and is the second most common chronic childhood condition after allergic disorders. Factors contributing to bedwetting include sleep arousal difficulties, nocturnal polyuria (excessive nighttime urine production), and bladder dysfunction.

[1] https://www.abct.org/fact-sheets/bed-wetting/