The top 10 investor told the Times that Unilever's rejection of Kraft Heinz’s £115bn bid was the right call because it was too low and said it must now sell off some of its £10.6bn food empire so as to enhance the value” of its underperforming business.
They added that the proposed deal represented a “watershed moment” for the company, which must now focus on “unlocking value”. Part of this approach should entail its own large-scale acquisitions in the personal care sector, said the investor, which fits with the reports of potential bids for Colgate-Palmolive and Church & Dwight.
Following the rebuffal of the bid Unilever chief executive Paul Polman announced a “comprehensive review" in order generate profit margins in line with top end expectations.
The review will be conducted by Unilever’s board, with the results announced in April, and one of the most likely approaches is the sale of brands including Flora, Marmite and Hellmann’s mayonnaise.
Andrew Wood, an analyst at the broker Bernstein, said the review represented an “impressively rapid start" to Unilever’s response to the bid, but added that some investors will question why Polman was not more aggressive over the last eight years.