PwC Annual Report 2018: Unilever


Unilever are one of the world’s largest fast-moving consumer goods businesses. Chances are, you will have one of their products either in your store cupboard at home or in your shower.  They manufacture a number of particularly large brands, like Magnum, Comfort, Dove and they also manufacture what they would term 'local jewels', so products like Coleman’s mustard or Marmite in the UK.

In 2017, they faced a hostile takeover bid from Kraft Heinz, the 3G owned US food major. The bid eventually fell away, but that did lead to Unilever detailing out their plans to 2020, which included a significant disposal, dramatic reshape of their cost base, simplification of their corporate structure.  All of this was designed to position them for future growth.

We’ve had a long-standing relationship with Unilever for many years through our Assurance team, Deals team and Tax team.  We actually supported them during the hostile bid, and when they made the decision to separate the spreads business ,they approached our Deals, Tax and Capital Markets team to help them with the carve-out and we'd actually done some work with Unilever previously to help them think about how they might separate the spreads business in preparation for a potential sale.

It was a hugely complex deal for Unilever and I think, they would acknowledge it themselves, that it was the most complex deal they’ve ever undertaken. So our Value Creation and Deals team helped to support them across numerous geographies, UK, US, Pakistan, South Africa, Switzerland to help facilitate this deal.

So this primarily involved finding a home for their global spreads business which operated across 90 plus markets and included a number of iconic brands which we’d all recognise like Flora, I Can’t Believe it’s not Butter - further afield in Europe, brands like Rama, and it actually accounted for 6% of Unilever’s global turnover.

We had a lot of people working on this worldwide, so across the globe we had 330 people who worked on the project across value creation and deals, financial due diligence, capital markets, tax, pensions, HRS.  We also had a dedicated deal value architect who worked on the project, working full time in order to generate as much value as possible for Unilever from the disposal of the spreads business.

We really enjoyed working with Unilever, it was clearly an iconic project and the team got a lot out of it, it was really interesting.  I also think Unilever were particularly pleased with the value we were able to bring, the functional expertise, our relentless focus on value creation for them, really went down well with their team. Clearly it was a long term project, so over 15 months, so communication and trust were key and our team have built a number of great relationships across the Unilever business.  According to Bloomberg this was the largest leverage buyout of 2017. Our Value Creation and Deals team is continuing to work with the Unilever business to support them in the separation of spreads and we’re looking forward to working with them on projects into the future.

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