Unilever sells off US detergents business
Shares in Unilever climbed after the Anglo-Dutch consumer goods giant announced it had finally sold its North American detergents business – after almost a year of struggling to find a buyer.
Private equity firm Vestar Capital Partners snapped up the business, which includes brands such as Snuggle, Wisk and Surf, for $1.45bn (£727m). Unilever has been seeking to sell the division after failing to compete against rival Procter & Gamble.
Vestar plans to merger the business into Huish Detergents, which it already owns, and create a new company called The Sun Products Corporation. It comes a week after Unilever sold its Bertolli olive oil brand to Spanish food company Grupo SOS for £500m, and sold Turkish olive oil brand Komili for an undisclosed amount to the Anadolu Group.
For the detergent business Vestar will pay $1.075bn in cash together with shares in Sun Products, worth $375m, and warrants offering Unilever the opportunity to acquire up to 2.5 per cent of the common equity in the new company.
Unilever group chief executive Patrick Cescau said the sale was a “good deal” for shareholders and the business.
Analysts at Citigroup agreed: “Given the length of the disposal process and poor retail volume trends in the business concerned, we view (it) as a good exit price,” said analyst Jeff Stent.
Cescau said the sale allows the company to now focus on its leading positions in other markets.
