), a leading manufacturer of cleaning and sanitation products,
has completed its previously announced acquisition of
Mexico-based Quimiproductos S.A. de C.V., a wholly-owned
subsidiary of leading consumer goods company,
In September last year, Ecolab had announced a definitive
agreement to acquire the aforementioned entity. However, the
company did not provide any financial details of the
Quimiproductos produces and supplies cleaning, sanitizing and
water treatment goods and services to breweries and beverage
companies located in Mexico. It also operates in the Central and
South America. In 2012, the company's revenues are estimated to
be $43.4 million.
Ecolab has a significant presence in international markets,
with Asia-Pacific and Latin America representing the key growth
areas for its overseas operations. Ecolab's Food and Beverage
business in Latin America is growing at a double-digit rate on
the back of solid demand in the beverage and brewing markets
along with new accounts and investments in strategic sales areas.
The company's Latin American sales jumped 20% in the last
reported quarter. We believe that the acquisition of
Quimiproductos should further boost the business in the
St. Paul, Minnesota-based Ecolab serves the foodservice, food
and beverage processing, healthcare, and hospitality markets in
the U.S. and abroad. We are encouraged by the company's
consistent performance of delivering double-digit earnings growth
despite the challenging business environment.
Ecolab is currently involved in the acquisition of a leading
specialty chemical company, Champion Technologies and its related
company Corsicana Technologies. The deal worth $2.16 billion
would be the company's largest acquisition since the Nalco
buyout. The proposed acquisition will beef up Ecolab's Global
Energy Services franchise and expand its foothold in the North
American energy market.
The transaction was expected to close by the end of 2012 but
due to certain antitrust-related issues with the U.S. Department
of Justice ("DOJ"), the company has extended its agreement till
Despite the impressive international exposure, we remain
cautious on Ecolab owing to aggressive competition from the likes
Church & Dwight
). We currently have a Neutral recommendation on Ecolab, which
carries a short-term Zacks #4 Rank (Sell).
CHURCH & DWIGHT (CHD): Free Stock Analysis
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