Kraft Proposes Deal to Merge With Unilever--Update
February 17 2017 - 8:14AM
Dow Jones News
By Anne Steele
Kraft Heinz Co. said Friday it has made a bid to merge with U.K
consumer products giant Unilever PLC, a move that would bring
together some of the best-known consumer-facing brands in the
world.
Kraft Heinz said Unilever has declined the proposal, but that
"we look forward to working to reach agreement on the terms of a
transaction."
The U.S.-based food and beverage maker said it is uncertain that
any further formal proposal will be made to Unilever or that an
offer will be made at all. It also said the terms of any such
transaction are uncertain.
Shares of Kraft Heinz rose 4.6% premarket in New York.
London-listed Unilever shares were trading 12% higher.
A deal would mark the latest wave of consolidation among
consumer-goods giants after Heinz in 2015 merged with Kraft in a
deal orchestrated by Warren Buffett and Brazilian private-equity
firm 3G Capital Partners L.P., creating one of the world's largest
food-and-beverage companies. 3G, an acquisitive Brazilian firm, is
known for buying consumer companies it considers bloated and
aggressively slashing costs.
Unilever, maker of Dove soaps and Axe body sprays, is the
world's second-largest consumer-goods firm by sales after Procter
& Gamble Co. Sales growth slowed last year, spooking investors
and underscoring the cost-cutting pressure that consumer-goods
companies face as they struggle to sell more of their staples, from
soap to packaged food, around the world.
--Saabira Chaudhuri contributed to this article.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
February 17, 2017 07:59 ET (12:59 GMT)
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