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May 13 (Bloomberg) -- Godrej Consumer Products Ltd., India’s second-biggest soapmaker, rose to a record in Mumbai after it agreed to buy Sara Lee Corp.’s stake in their venture for 185 million euros ($234 million).

Godrej Consumer surged 13.5 percent to 338.85 rupees, the highest since it started trading in 2001. The benchmark Sensitive Index advanced 0.4 percent.

The detergent, cosmetics and household items maker exercised the right to buy its partner’s 51 percent stake in the venture Godrej Sara Lee Ltd. after Sara Lee decided to exit the household insecticides business. Godrej Sara Lee sells products such as insect-killer Hit and mosquito-repellant GoodKnight.

“This is a fantastic deal,” said Anand Shah, an analyst at Angel Broking Ltd. in Mumbai, who rates the stock “accumulate.” The acquisition of Sara Lee’s stake in the venture will add as much as 900 million rupees ($20 million) to net income in the year ended March 31, 2012, Shah said.

Sara Lee, based in Downers Grove, Illinois, has been selling units to focus on coffee and food. Godrej last year said it seeks to acquire businesses in Asia, Latin America and Africa to widen its portfolio of hair color and personal hygiene products as well as household insecticides.

‘Important Step’

“The acquisition represents an important step towards Godrej Consumer becoming a leading emerging-markets multinational and dovetails well with our global ‘3 by 3’ strategy - presence in three continents - Asia, Africa and Latin America through three core categories - home care, personal wash and hair care,” Godrej Chairman Adi Godrej said in a statement.

Sara Lee last year agreed to sell its toiletries business to Unilever NV and its air-fresheners business to Procter & Gamble Co. for a combined 1.59 billion euros and said both transactions will close this year.

In April, Mumbai-based Godrej Consumer agreed to purchase Indonesian insecticide maker PT Megasari Makmur for an undisclosed price. The purchase would add 500 million rupees to profit for the year ending March, Godrej said May 7.

To contact the reporter on this story: Saikat Chatterjee in New Delhi at

To contact the editor responsible for this story: Frank Longid at

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