Unilever product, Blue Band, at display in a supermarket. [ photo / Business Daily. ]
Unilever has finally settled on selling its shrinking margarine business to a US private equity firm KKR for Sh 824 billion as they focus on developing faster-growing products.
In the deal that was inked on Friday, Unilever will sell its spreads business including Becel, Flora, Country Crock and Blue Band to KKR as it has been declining over past few years due to a drop in the number of people eating bread and margarine.According to Unilever Chief Executive Paul Polman, the sell of the spread business will enable the company to concentrate on the development of long-term projects in future. “The announcement today marks a further step in reshaping and sharpening our portfolio for long-term growth,” said Polman. Unilever had in April this year advertised to sell its business after reviewing its assets that had been compelled by February’s unsolicited $143 billion takeover attempt by Kraft Heinz.The sale was auctioned by Goldman Sachs and Morgan Stanley and it saw many private equities bid in buying the spread business but the New York-based firm KKR managed to outbid its rivals to purchase the business. KKR firm had recently bought a majority of shares at vitamin maker Nature’s Bounty and had also invested in India’s Coffee Day Resorts and Chinese white goods maker Qingdao Haier.The deal is expected to be closed by May next year as a subject to regulatory approvals and employee consultations.