Unilever will sell its spreads business which includes brands such as Flora, Stork and Blue Band to US private equity firm KKR for €6.83 billion.
The move to offload the unit was announced in April as Unilever seeks to rejuvenate its business following the failed takeover attempt by Kraft Heinz.
The spreads division has been performing poorly after recording a decline last year as consumers switch to more natural alternatives.
Unilever also owns the I Can’t Believe It’s Not Butter and Bertolli brands and the unit in total had sales last year of €3 billion and earnings before interest, taxation, depreciation and amortisation of €680 million. It employs 2,300 people around the world and represents around 7% of Unilever’s global business.
CEO of the spreads business Nicolas Liabeuf will continue to lead the unit. “There is a positive momentum in the performance of the spreads business and we are excited about continuing this journey with KKR,” he said.
“We are confident that our business and the entrepreneurial spirit of our people will thrive further under new ownership.”
Outgoing Unilever CEO Paul Polman added: “In April of this year we set out our 2020 programme to accelerate sustainable value creation. After a long history in Unilever we decided that the future of the spreads business would lie outside the group.
“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.”
Johannes Huth, head of KKR EMEA, said: “The strength of the portfolio of consumer brands in spreads provides a firm foundation for future growth.
“We look forward to deploying our global network and operational expertise to support the business’s growth ambitions, while continuing to follow Unilever’s responsible sourcing policies, including working towards the goal of sourcing 100% sustainable palm oil by 2019.”
In a separate deal earlier this year, Unilever traded its spreads business in southern Africa for Remgro’s stake in its South African subsidiary.
© FoodBev Media Ltd 2019