In Brief

Unilever could sell Flora after failed Kraft Heinz bid

Company also plans to merge its foods and refreshments arms and could end its dual-listed status

Unilever has finally responded to its failed £115bn takeover bid by Kraft Heinz in February, proposing a series of reforms that includes potentially selling off its spreads business.

The Anglo-Dutch company has been undertaking a review since the offer was roundly rebuffed and said its plans would ultimately boost profit margins to 20 per cent.

Most headline-grabbing is the plan to either sell outright or demerge as a standalone business its spreads unit, which includes brands such as Flora. The Financial Times reports it is is worth €6bn-€7bn (£5bn-£6bn).

Unilever bosses said the business was a "declining segment" that could be "better managed by others", adds the BBC.

George Salmon, of stockbrokers Hargreaves Lansdown, told the broadcaster this reflects the "reality of 21st century life".

He added: "People are more likely to grab breakfast 'on the go' rather than sit around the table with a few slices of toast."

Other parts of Unilever's plan include merging the foods and refreshment businesses into one unit in a new cost-saving drive, the target for which across the whole company will be doubled to €2bn.

Foods includes brands such as Marmite and Hellman's Mayonnaise, while refreshments features the likes of Ben & Jerry's ice cream and tea brands Lipton and PG Tips.

The company is also preparing to add debt to its balance sheet and signalled it could seek to buy Reckitt Benckiser's food business, which is currently under "strategic review". Its brands include French's mustard and Frank's Red Hot sauce.

At a more structural level, Unilever said it will hand €5bn (£4.27m) to investors in the form of a share buy-back this year - and this could rise if it does not pursue any acquisitions.

It has additionally initiated a review into whether it is still efficient to maintain its listings in both the Rotterdam and London.

Recommended

Christmas comes early for UK retailers
Black Friday shopping London
Business Briefing

Christmas comes early for UK retailers

Jack Dorsey resigns: Twitter needs ‘more than a part-time chief’
Jack Dorsey
Profile

Jack Dorsey resigns: Twitter needs ‘more than a part-time chief’

Who is the richest person in the world?
Jeff Bezos, Elon Musk and Bernard Arnault
In Focus

Who is the richest person in the world?

Shared ownership: how the home buying scheme works
UK housing
Pros and cons

Shared ownership: how the home buying scheme works

Popular articles

19 advent calendars for adults
Selection of advent calendars
The wish list

19 advent calendars for adults

Vladimir Putin and his mysterious love life
Vladimir Putin and his now ex-wife Lyudmila Putina
Profile

Vladimir Putin and his mysterious love life

Trump ‘upset his son won’t say he loves him’
Donald and Barron Trump
Tall Tales

Trump ‘upset his son won’t say he loves him’

The Week Footer Banner