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Diaper dramas make for much to absorb: A review of the year in the disposable baby diaper market.

Associated Hygienic Products

It was an eventful year for Associated Hygienic Products, Duluth GA. The company acquired private label diaper manufacturer Drypers, Houston, TX, in March as part of an effort to build its position in the disposable diaper and adult incontinence categories. The deal included the acquisition of Drypers' manufacturing operations in Marion, OH and Vancouver, WA. The purchase of the premium Drypers brand as well as the group's private label retail partners complement AHP's "Fitti" brand, according to the company.

In November, AHP finalized a partnership with five retail outlets, including Associated Wholesale Grocers, DeMoulas Super Markets, Eckerd, Giant Eagle and Wakefern/ShopRite. AHP is offering its new partners a full range of private label disposable personal care products including its new premium training pant and its exclusive youth pant product. The partnerships will make AHP products available to consumers in more than 4000 retail locations throughout the U.S.

Additionally, AHP will soon market a disposable changing pad under the "Koala Bear Care" brand name. The changing pad, which represents the first Koala-branded name to be sold in a retail setting, is the result of a licensing agreement AHP signed with Koala Corporation, Denver, CO, last year. The changing pad is reportedly a new entry into the baby care category and is the first of its kind sold in North America. Called "Koala Kare Mats," the soft absorbent changing pad has a moisture-proof backing that provides parents with a convenient and sanitary way to change diapers away from home, according to company executives. The mats will be sold at select Wal greens drug stores and Kroger supermarkets beginning in the first quarter of this year.

BDF Nivea

This year, newcomer baby diaper manufacturer BDF Nivea, Sao Paulo, Brazil, part of global consumer product manufacturer, Beiersdorf, Hamberg, Germany, made its debut. BDF is set to enter the diaper market with its "Nivea Baby" brand of products, which includes a line of wet wipes that are reportedly priced higher than that of the current popular brand in the market but with better quality.

CMPC

Chilean disposable baby diaper producer Compania Manufacturera de Papeles Y Cartones (CMPC), Laja, Chile, has re-entered the Chilean diaper market with products imported from its manufacturing plants in Peru, Argentina and Uruguay in March. CMPC's Peru and Uruguay facilities are now the supply bases for CMPC's new "Babysec" brand diaper line. According to NONWOVENS INDUSTRY South American correspondent Freddy Gustavo Rewald, the move is a result of CMPC's separation from its parent company Prosan, which distributed "Pampers" and "Babysan" diapers for Procter & Gamble, Cincinnati, OH, in Argentina and Chile.

Disposable Soft Goods

Also acquiring a segment of Drypers assets was Disposable Soft Goods International, Kwai Chung, Hong Kong. DSG purchased $38.5 million of Drypers' North American assets in the beginning of the year. DSG and its predecessors have been manufacturing and distributing disposable baby diapers since 1973.

Kimberly-Clark

Another diaper manufacturer reporting an eventful year was Kimberly-Clark, Dallas, Th, which made headlines on several different occasions as it continues to expand globally. Among the years' highlights were several improvements to K-C's "Huggies" brand of diapers in August and the purchase of Milan, Italy-based Linostar's "Lines" baby diaper line January.

In January K-C increased its stake in Europe when it purchased Linostar, which has a 30% share of the Italian diaper market and also sells its brand of Lines diapers in Portugal, Spain and some other southeastern European countries. And in another move to expand its scope in Europe, K-C announced in February that it would redesign its Huggies line with the introduction of three different age categories--zero to three months ("Beginnings"), four to 12 months ("Freedom") and older than 12 months ("Adventurers"). The line reportedly reflects the way parents see the growth of their babies. Product improvements include a soft outer cover and leak guards for the Beginnings stage, greater absorbency and dryness for the Freedom stage and a new super-premium, better-fitting diaper for babies in the Adventurers stage. The improvements were designed by K-C's European business, headquartered in Reigate, U.K., and were launched into each of K-C's European markets, including the U.K, France and Italy.

Looking toward Asia, K-C also merged its subsidiaries, S-K Corporation and Taiwan Scott Paper Corporation, into one company, named Kimberly-Clark Taiwan, in September. With annual sales of more than $200 million, Kimberly-Clark Taiwan is the country's second largest consumer products company. K-C acquired the majority shares in S-K Corporation in July 2000 and a 100% interest in Taiwan Scott Paper in December 2000. The new company is divided into two divisions, family care, which markets consumer tissue products, and personal care, which markets disposable baby diapers and feminine napkins. Meiling Chang leads the family care segment while Frank Lin heads the personal care division.

K-C's activities also extended into South America. The company opened a new distribution center, worth $4 million, in Suzano, Sao Paulo, Brazil in September. The new center serves as the distribution arm for the company's disposable diaper, sanitary napkin and wet wipe businesses in the region. The warehouse is 16,000 square meters and has a capacity of one million bales.

In legal news, K-C had a patent appeal against Tyco International, Pembroke, Bermuda thrown out in a U.S. circuit court. The lawsuit accused Tyco International of infringing on one of three K-C patents through its Kendall Healthcare Products Unit. The patents involved elastic flaps that help prevent leaks in diapers. The U.S. Court of Appeals for the Federal Circuit ruled 3-0 that the fluid impervious flaps in the Kendall diapers were not within the scope of the K-C patents, which cover only flaps that allow fluid to pass through them.

MPC/Stronger Corporation

Stronger Corporation, parent company of disposable baby diaper manufacturer MPC Productos de Higine Ltda., Blumenau, Brazil, acquired Drypers' Brazilian operations in April. The $11.5 million transaction includes Drypers' facilities in Argentina, Colombia and Brazil. With a combined capacity of 50 million units per month, Drypers' "Puppet" and "Baby Bop" product lines were added to MPC's current brand names, "Cremer," "Chicolastic" and "Plim Plim." According to MPC, the move will consolidate the company's position within the South American baby diaper market.

Paragon/Tyco International

Last month, Tyco International, Pembroke, Bermuda, announced that it will purchase private label diaper manufacturer Paragon Trade Brands, Norcross, GA, for $522 million in cash through its Tyco Healthcare International subsidiary. Tyco Healthcare currently manufactures and markets a range of absorbent personal care products through its Kendall Healthcare Products Unit and hopes its acquisition of Paragon will add to its retail and clinical care markets business. This latest transaction between Tyco and Paragon concludes an evaluation of strategic alliances announced in June 2001 by Paragon's majority shareholder, Wellspring Capital Management. An investment group led by Wellspring purchased a majority interest in Paragon in June 2000.

For its part, private label manufacturer Paragon had a big comeback after officially exiting Chapter 11 status in 2000. Early in the year, Paragon won the right to be the stalking horse bidder in the acquisition of Drypers, Houston, TX. The U.S. Bankruptcy Court for the Southern District of Texas-approved proposal included an acquisition price of $70.2 million in cash and subsidiary debt with Paragon to be the lender in connection with a proposed additional $5 million post-petition credit facility.

Procter & Gamble

Disposable product giant Procter & Gamble, Cincinnati, OH, continued to grow by adding two products to its "Pampers" brand. First up came "Pampers Bibsters," a disposable bib that was reportedly a first for Pampers. The product contains a cloth-like topsheet with colorful animal prints, an absorbent middle layer and a protective barrier backsheet with a reattachable fastening system. Bibsters are offered in two sizes--small, for children ages zero to six months, and large, for children ages six months and older. The smaller sized bibs are meant for bottle drips, shoulder protection and clean up, while the larger sized bibs are meant more for mealtime and playtime.

The second product is the "Pampers Sensitive" disposable baby diaper, which was first introduced in the U.K. and France. The new diaper features a velcro-type fastening system and lotion care that is based on zinc oxide. Pampers Sensitive is hypoallergenic, anti-irritating and contains no perfumes. The product is available in four sizes--mini, midi, maxi and junior.

In other news, P&G finally won a long battle with rival Amway, Ada, MI, regarding rumors linking P&G's crescent-shaped "man in the moon" logo to Satanism in the late 1970s. P&G has sued 15 times to quell the rumors with eight of the suits involving Amway or its distributors.

RMED/Hospital Specialty

Disposable baby diaper and wet wipe manufacturer RMED International, Westport, CT, sold its baby diaper manufacturing assets to Presto Disposable Products, a wholly-owned subsidiary of National Presto Industries, Eau Claire, WI, in late November. In further terms of the agreement, Presto will manufacture disposable diapers for RMED to distribute and market under the "Tushies" and "TenderCare" brand names. The company plans to continue to market and sell disposable baby diapers, wipes and related products through more than 10,000 health food stores, direct home delivery and mail order.

RMED also received two multi-million dollar orders for its absorbent products. The first was a $12 million order commitment for its "Bumpies" brand baby diapers in January. The commitment fits in with RMED's new growth strategy that began when it expanded its Eau Claire, WI facility. The company also received more than $5 million in private label disposable baby diaper orders through its alliance with Hospital Specialty Company (Hospeco), Cleveland, OH. The diapers will be manufactured in RMED's Eau Claire facility and shipped later this year.

Uni-Charm Corporation

Although not a drama-filled year for Uni-Charm Corporation, Kagawa, Japan, in 2001, the company began producing baby diapers in China in July. The Kagawa-Pref., Japan-based, company already produces diapers in Thailand, Korea and Japan, and it wanted to provide domestically made products to the Chinese market rather than exported products, according to reports.
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Title Annotation:diaper industry briefs
Comment:Diaper dramas make for much to absorb: A review of the year in the disposable baby diaper market.(diaper industry briefs)
Publication:Nonwovens Industry
Geographic Code:1USA
Date:Jan 1, 2002
Words:1673
Previous Article:2001 International Baby Diaper Manufacturers' Directory: Annual listing of global producers of disposable baby diapers.
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