Business News

Fresh from fending off Kraft, Unilever to review strategy

Munshi Ahmed | Bloomberg | Getty Images

Unilever said it was reviewing its options to drive shareholder value, just days after it swiftly rejected a surprise $143 billion takeover bid from Kraft Heinz.

"The events of the last week have highlighted the need to capture more quickly the value we see in Unilever," it said in a brief statement, sending its shares up 2.6 percent.

"We expect the review to be completed by early April, after which we will communicate further."

Kraft, which is backed by Warren Buffett and the private equity firm 3G, had wanted to buy Unilever as part of its strategy of buying competitors and cutting costs to drive profits.

Unilever, the ice cream-to-shampoo producer, flatly rejected the approach on Friday, saying it saw no financial or strategic merit in a deal.

But investors have called on the firm to review its costs and structures to see if it could do more to deliver the profit that Kraft had seen. Unilever's operating profit margin falls well short of Kraft Heinz and other rivals.

The review, to be led by the board, is likely to look at the firm's cost base and its structure, including whether there is an advantage in producing food and personal and home care products.

Unilever's London-listed shares were up 2.8 percent, just 3 percent below where they were trading on Friday when news of the Kraft approach broke.

Read more:
The $143 billion flop: How Warren Buffett and 3G lost Unilever

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