Unilever (LON:ULVR) is preparing a £6-billion disposal programme for some of its largest brands, media have reported. The move would come amid shareholder criticism in the wake of Kraft Heinz’s failed bid for the Anglo-Dutch consumer goods company.
Unilever’s share price closed marginally lower on Friday, shedding 0.28 percent to 4,040.00p, underperforming the broader London market, with the benchmark FTSE 100 index adding 9.01 points to end the session 0.21 percent higher at a record 7,424.96. The group’s shares have gained more than 30 percent over the past year, and are up by some 22 percent in the year-to-date.
The Sunday Times reported yesterday that Unilever could offload its Flora margarine and Stork butter brands, as the group’s chief executive Paul Polman prepares to address City concerns raised after Kraft Heinz’s withdrawn $143 billion offer that the FTSE 100 company has not focused enough on shareholder returns. The Telegraph meanwhile quoted sources as saying that private equity groups Bain Capital, CVC and Clayton Dubilier & Rice, had already started working on offers for the group’s non-core margarine division, with Kraft Heinz also tipped as a possible buyer.
The news comes after Unilever recently announced a review of its options to accelerate value for shareholders in the wake of Kraft Heinz’s failed bid. The review is expected to be completed early next month.
Richard Buxton, boss of Old Mutual Global Investors, which does not own any shares in the company, meanwhile told The Sunday Times that Unilever had been right to reject Kraft’s bid and focus on putting its house in order.
“Rally your board, employees and shareholders around your business model and balance sheet,” he pointed out.