Ecolab Inc (ECL Quick QuoteECL - Free Report) recently announced its intentions to buy Lille, France-based Laboratoires Anios, a well known manufacturer and marketer of hygiene and disinfection products.

Ecolab has made a binding offer for Laboratoires Anios, which is currently owned by Bertrand and Thierry Letartre along with private investment company Ardian. Upon receiving approval from their French works councils, the parties (Ecolab and the sellers) will enter into a definitive purchase agreement.

Although the financial terms of the deal were not disclosed, the takeover is expected to complete by the end of 2016, subject to approval from regulatory and competition authorities.

Laboratoires Anios has a strong clientele and has presence in almost 85 countries. The company reported sales of almost $245 million (€220 million) in full-year 2015. The company has three production sites that have the capacity to produce 50,000 tonnes per year and approximately 120,000 bottles are packed daily.

The takeover of Laboratoires Anios will expand Ecolab’s institutional customer base and service coverage, particularly in the healthcare, food service, and food & beverage processing industries. Moreover, it will strengthen the company’s footprint in the emerging markets of Latin America and Asia-Pacific.
 

ECOLAB INC Price and Consensus

ECOLAB INC Price and Consensus | ECOLAB INC Quote

Notably, emerging markets hold promising prospects for Ecolab in the food & beverage business, which increased 19% in the first quarter of 2016. The company believes that food safety business has significant growth opportunities in the emerging markets due to growing demand for better food quality in the regions.

Apart from food & beverage, Ecolab is expected to pursue acquisitions that will boost its market share in the water and healthcare business. Moreover, continuing product launches in the water business will drive the top line. The company forecasts revenues on new launches for water to be around $25 million to $30 million for full-year 2016.

Zacks Rank & Key Picks

Ecolab has a Zacks Rank #3 (Hold).

Better-ranked stocks in the same space include Chemtura Corporation , Ferro Corporation and Flexible Solutions International Inc. (FSI Quick QuoteFSI - Free Report) . All the three stocks carry a Zacks Rank #2 (Buy).

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