Unilever’s latest announcement has shocked the world and especially the corporate sector. The multinational company is selling its global tea business that brought in billions in revenue in the last year. What has prompted this decision and why has it been sold? Let’s find out!
Unilever’s Global Tea Business
The name of Unilever’s global tea business is Ekaterra. It is the world’s leading tea business which also has a portfolio of 34 brands including Lipton, PG tips, Pukka, T2 and TAZO. Ekaterra’s business has generated revenues of approximately €2 billion in 2020 but this year the business has made a turn. Unilever has decided to sell this jewel in their crown and has announced the sale to CVC Capital Partners Fund VIII in the last week.
More About The Transaction
It is being said that the completion of this transaction will be completed in due time. The council consultation processes and the receipt of certain regulatory approvals are yet pending. As a result, the completion of the sale is expected to conclude in the second half of 2022. There’s nothing simple about it!
However, here’s the catch! Ekaterra’s boundaries in India, Nepal, and Indonesia will be kept with Unilever, they are excluded from the sale. Moreover, Unilever’s interests in the Pepsi Lipton ready-to-drink Tea joint ventures and associated distribution businesses will also remain.
What Has Unilever Said?
Alan Jope, the CEO of Unilever, said that this sale is nothing resembling a step backwards. Their portfolio is only developing further and this sale shows the big plans that Unilever has in store for them. There are bigger fish to catch! Jope said, “We are proud of the place that our Tea business has in our company’s history.”
Pev Hooper, a Managing Partner at CVC Capital Partners, noted that Ekaterra is a prime target in an attractive market to accelerate its future growth. CVC, according to Unilever’s team, will only help it reach new heights. “We look forward to working with the team to realise ekaterra’s full potential”, said Hooper. Until the sale finalises the business will remain with Unilever and this period of transition may slow down its growth too. However, in 2022 Ekaterra is definitely set for a boost as CVC will push full-throttle on this new asset.
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