MERGERMARKET
Unilever takes CD&R/Bain, Apollo and KKR to second round of spreads sale
25 OCT 2017
The auction of Anglo-Dutch consumer goods group Unilever's[LON: ULVR]; [AMS:UNA] spreads business entered the second round yesterday. Private equity firms KKR [NYSE:KKR] and Apollo are through, as well as a CD&R-Bainconsortium, two sources familiar with the situation said.
Other bidders including a Blackstone-CVC consortium, as well as BC Partners did not progress further, the sources said. The sale is run as a dual-track process, one of them added.
The Financial Times, reporting on the private equity firms making it to the next round, said KKR had been considering a bid with Singapore wealth fund GIC. A report by Reuters also mentioned the buyout firms invited to round two and said the USD 7bn sale could be finalised by the end of this year.
Information on the sale is limited so far, but the company is projecting an EBITDA and sales decline in the next couple of years. However, as a standalone business, it expects both earnings and revenues to increase, according to two further sources familiar with the situation.
EBITDA would drop to EUR 632m in 2017 from EUR 685m in 2016, but pro-forma for the carveout it is projected to grow to EUR 740m in 2017, EUR 747m in 2018 and EUR 766m in 2019, said the sources.
IMs were distributed end of September, as reported.
In April, Unilever finance director Graeme Pitkethly reportedly said that Unilever would consider selling its South African and North American spreads business separately from other units in its spreads division.
Unilever CEO Paul Polman announced plans to sell the margarine spreads business in April, as reported. The spreads business includes Flora, Stork, Country Crock and other slow-growing brands.
Acuris, owner of this news service, is a BC Partners portfolio company.
Apollo, Blackstone, CVC, CD&R and Bain declined to comment. Other companies did not respond to a request for comment.