Unilever to shift Flora and Stork in corporate shakeup
Unilever has revealed plans to sell the Flora and Stork brands as part of a major structural review, thought to be in response to Kraft Heinz's attempted takeover earlier this year.
7 April 2017
The industry was rocked earlier this year when news spread of an ill-fated takeover bid of Unilever by Kraft Heinz.
The €143bn move (which would have resulted in an unfathomably huge food giant) was rejected by Unilever, but it appears the company has acknowledged the weaknesses that made it vulnerable to the takeover bid. It will sell the Flora and Stork brands, and also move to restructure several of its divisions, according to foodbev.com.
Unilever, which also owns Bertolli and I Can’t Believe It’s Not Butter (recently rebranded as I Can’t Believe It’s So Good), is keen to prove to shareholders that it can survive in its current form. As such, the company plans to initiate a share buyback programme and establish a debt-to-pre-tax-earnings ratio of 2:1.
Unilever’s food business and refreshment divisions will also combine, a move which the company says will help it to “unlock future growth and faster margin progression”.
Paul Polman, Unilever’s CEO, said the transformation will build on the company’s strong, worldwide portfolio. “We have established a responsible, investment-led growth model,” he said, “that is well-equipped with global scale and unrivalled distribution strength in emerging markets.
“For 2017,” Polman added, “we remain on track to deliver underlying sales growth of 3-5%. We feel confident that the changes we are announcing will accelerate the transformation of Unilever and delivery of sustainable shareholder value in the long term.”
Of course, reading between the lines, what he is really saying is the transformation will hopefully protect it from another takeover bid. Watch this space, because we sense this is not the end of the story.