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Posted: December 15, 2017
Unilever To Sell Spreads Business To KKR For EUR6.83 Billion
LONDON (Alliance News) - Anglo-Dutch consumer goods manufacturer Unilever PLC said late Friday that it will sell its global spreads business to US buyout fund KKR & Co LP for EUR6.83 billion on a cash and debt free basis.
The sale is a result of Unilever’s decision to sell off non-core assets, which it initiated after rebuffing a USD143 billion takeover approach in February from Kraft Heinz Co.
"The announcement today marks a further step in reshaping and sharpening our portfolio for long term growth. The consideration recognises the market leading brands and the improved momentum we have achieved. I am confident that under KKR's ownership, the Spreads business with its iconic brands will be able to fulfil its full potential as well as societal responsibilities," said Unilever Chief Executive Paul Polman.
Nicolas Liabeuf, chief executive of the spreads business said "There is a positive momentum in the performance of the spreads business and we are excited about continuing this journey with KKR. We are confident that our business and the entrepreneurial spirit of our people will thrive further under new ownership." Liabeuf will continue to lead the spreads business after the sale.
The investment is being funded by both the European and North American private equity funds of KKR, the FTSE100 listed company said.
Unilever intends to return the net cash realised to shareholders, unless it finds more value-creating acquisition opportunities. The deal is expected close in the middle of next year.
Unilever's spreads business includes brands such as Becel, Flora, Country Crock, Blue Band, I Can't Believe It's Not Butter, Rama and ProActiv. It operates across 66 countries around the world. In 2016, the business had a turnover of EUR3.03 billion, adjusted earnings of EUR680 million and assets of EUR1.11 billion.
The deal with KKR excludes Unilever's South Africa spreads business. Unilever, as previously announced, plans to acquire Remgro's 25.75% shareholding in Unilever South Africa Holdings (Pty) Ltd in exchange for the Unilever spreads business in Southern Africa as well as a cash consideration.
London listed shares in Unilever closed at GBP41.96, up 1.4%.