Kraft Heinz drops bid for Unilever
LONDON: Kraft Heinz's rapid retreat from its surprise US$143 billion (S$203 billion) bid for Unilever in the face of stiff resistance from the company and politicians sent shares in the Anglo-Dutch group 8 per cent lower yesterday.
Kraft, which is backed by Mr Warren Buffett and the private equity firm 3G, wanted to buy Unilever as part of its strategy to become a global consumer goods giant by purchasing competitors and cutting costs and jobs to drive profits.
However, the US food group had not factored in the resistance it received from Unilever Chief Executive Paul Polman, who dismissed its offer as having no financial or strategic merit, and requiring no further discussion.
Britain's response was also a concern after Prime Minister Theresa May signalled she would take a more proactive approach to foreign takeovers, sources said.
Mrs May, who had previously singled out Kraft's 2010 acquisition of another British household name, Cadbury, as an example of a deal that should have been blocked, had indicated her government would want to examine the deal if it went ahead, according to a person familiar with the situation.
Dutch Prime Minister Mark Rutte, who used to work at Unilever, had also said he would examine what it would mean for the Netherlands.
Unilever's London-listed shares, which jumped 13 per cent to a record high when the bid was made public on Friday, fell 8 per cent to give it a market value of £100 billion (S$177 billion). - REUTERS