UPDATED JAN. 20: Unilever announced Jan. 19 that it would not increase its $68 billion offer for GlaxoSmithKline's consumer health care divison, effectively killing the deal.
Unilever is looking at a future where its food & beverage units are de-emphasized or even sold off, company executives say.
Unilever has made several bids for the consumer healthcare division of GlaxoSmithKline, whose products include Advil pain reliever and Aquafresh and Sensodyne toothpaste. The latest bid was reported at $68 billion. A deal like that would require Unilever to raise cash, and one way to do so would be to sell off its remaining food & beverage portfolio.
In remarks to reporters quoted in the Wall Street Journal, CEO Alan Jope indicated that Unilever will be de-emphasizing its food & beverage products, which includes Ben & Jerry’s ice cream and Hellman’s mayonnaise. Jope said that while those businesses are still profitable, “It is true that food and refreshment’s long-term growth profile has been below other parts of the portfolio.”
In a filing with the Securities and Exchange Commission, Unilever declares that a strategic review “concluded that Unilever's future strategic direction lies in materially expanding its presence in Health, Beauty, and Hygiene,” and that “major acquisitions should be accompanied by the accelerated divestment of intrinsically lower-growth brands and businesses.”
Unilever has already sold parts of its food & beverage businesses recently, including its spreads portfolio in 2017 and most of its tea business in 2020.
