Australian manufacturer Ansell has sold its condom business to a consortium of China’s Humanwell Healthcare and conglomerate CITIC, for $800 million.
The buyers will take on Ansell’s Sexual Wellness division, which manufactures condoms and personal lubricants.
Last year, the division achieved a pre-tax earning of $38 million with $190 million worth of sales.
According to Ansell chief executive Magnus Nicolin, the global condom market is currently in flux, making this the right time to sell the business. He added that the sale will allow Ansell to concentrate on its core activity of selling to medical and industrial end markets.
It is expected that the company will receive $705 million in profits (after tax) from the sale. Ansell has committed to spending $356 million of this profit on buying back 10 per cent of the company’s shares over the next year.
None of the Ansell’s sexual wellness products are made in Australia, although the division employs approximately 10 people locally in sales and marketing. Nicolin said he did not expect the new owners to reduce the workforce.