Foreign General News/Info Revenue

Unilever To Sell Blue Band, Other Brands To KKR For $8bn

Unilever has agreed to sell its margarine and spreads business to U.S. private equity firm KKR for 6.83 billion euros ($8.04 billion) to concentrate on faster growing products, Reuters has disclosed.

The maker of Knorr soup and Dove soap announced the deal on Friday, hours after Reuters reported that KKR had entered exclusive talks to buy the shrinking business after outbidding rivals.

The brands to be sold include, Becel, Flora, Country Crock and Blue Band. Unilever put the business up for sale in April, following a review of its assets prompted by February’s unsolicited $143 billion takeover attempt by Kraft Heinz.

The company’s Chief Executive Officer, Paul Polman, was reported to have said that “the announcement today marks a further step in reshaping and sharpening our portfolio for long-term growth,” adding that “the consideration recognizes the market leading brands and the improved momentum we have achieved.”

Reuters stated that the spreads business has been in decline for years as people eat less bread and margarine, but Unilever has taken steps to stem the decline and the unit is very profitable.

The reports adds further that that made it attractive to private equity firms who were the main bidders in the auction run by Goldman Sachs and Morgan Stanley.

Based in New York, KKR had $153 billion in assets under management as of the end of September. The firm has a long history in the consumer sector and it has investments in India’s Coffee Day Resorts and Chinese white goods maker Qingdao Haier.

Reuters recalled that earlier this year, KKR bought majority control of vitamin maker Nature’s Bounty, adding that the deal with Unilever is expected to close mid-2018, subject to regulatory approvals and employee consultations.

The company, whose sales unexpectedly slowed in October, said it planned to return the cash to shareholders, unless more value-creating acquisition options arise.

This year Unilever has snapped up small brands including Tazo tea, Sundial Brands and Carver Korea.

Unilever confirmed last month it favoured ending its dual Anglo-Dutch structure to become a single entity, but it has delayed a decision whether it would be based in Britain or the Netherlands.

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