SCA, a leading global hygiene and forest products company, and the majority shareholder in China’s third-largest tissue company, Vinda International Holdings is strengthening its cooperation with Vinda. SCA will transfer its hygiene business in China, including mainland China, Hong Kong and Macau, to Vinda.

As part of the transaction, SCA and Vinda have signed an agreement regarding the exclusive license to market and sell the SCA brands—TENA, (incontinence products) Tork (Away from Home tissue), Tempo (consumer tissue), Libero (baby diapers) and Libresse (feminine care) in the area. With this agreement, Vinda will hold the rights to these product brands in these Chinese markets. Vinda will acquire SCA’s Dr P and Sealer brands in China.

“With its immense number of inhabitants, aging population and low penetration of hygiene products, China is an attractive and important market with significant potential for future growth. This new cooperation and transaction will generate mutual benefits for both SCA and Vinda particularly in distribution, sales, innovation and R&D. Vinda will get access to a broader product portfolio and SCA’s brands will have the potential to reach a broader base of consumers and customers via the extensive and robust distribution network of Vinda in China,” says Jan Johansson, president and CEO of SCA.

SCA has been a shareholder in Vinda since 2007, became its majority shareholder in late 2013 and has consolidated Vinda financials since the first quarter of 2014.

SCA’s hygiene business in China (Mainland China, Hong Kong and Macau) had net sales of approximately SEK 600 million ($87 million) in 2013. The purchase consideration amounts to HKD 1,144m ($147 million) on a debt-free basis.

The agreement is subject to approval by the independent shareholders of Vinda. Vinda is listed on the Hong Kong Stock Exchange.