Bidders prepare to submit formal offers for Unilever’s (LON:ULVR) £6-billion spreads business, The Sunday Times has reported. The news comes after it recently emerged that there were only three parties left in the auction for the unit which the Anglo-Dutch giant has been looking to sell as part of its efforts to unlock value for shareholders.
Unilever’s share price was little changed on Friday, adding 0.20 percent to close at 4,181.50p, underperforming the broader UK market, with the benchmark FTSE 100 index rallying about one percent. The consumer goods group’s shares have added a little over a third to their value this year.
Spreads auction update
City bankers told The Sunday Times that Unilever’s financial advisers have set a deadline of early this week for final offers for the division, which also includes Bertolli olive oil, Stork and I Can’t Believe It’s Not Butter.
American firms KKR and Apollo, and European buy-out shop CVC Capital Partners are said to have made it through to final stages of the auction process and are expected to table final-round bids in the region of £6 billion.
The newspaper further quoted one source as saying that Apollo, run by Wall Street dealmaker Leon Black, was ‘extremely keen’ to complete the deal and was working ‘hard’ on its offer for the business.
Unilever has been looking to offload the business as it looks to simplify itself and unlock more value for shareholders in the wake of Kraft Heinz’s failed bid earlier this year.
Analysts on Unilever
JPMorgan Chase & Co reiterated its ‘neutral’ rating on Unilever last week, valuing the shares at 4,400p, while Goldman Sachs, which sees the company as a ‘sell,’ set a price target on the stock of 3,820p. According to MarketBeat, the Anglo-Dutch consumer goods giant currently has a consensus ‘hold’ rating and an average price target of 4,253.77p.