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Unilever commences ‘comprehensive’ business model review after failed Kraft Heinz bid

23.02.2017
Unilever commences ‘comprehensive’ business model review after failed Kraft Heinz bid

Unilever has announced plans for a “comprehensive review” of its business model, in the wake of this week’s mooted takeover by Kraft Heinz.

US food giant Kraft Heinz abandoned its $143bn takeover of the Anglo-Dutch FCMG firm earlier this week, after Unilever dismissed the potential merger as being of “no merit, either financial or strategic”.

However, under pressure from investors to boost shareholder returns, Unilever chief executive Paul Polman has kicked off a two-month review of its structure and product portfolio to examine ways to increase profitability.

Unilever issued the following statement: “Unilever is conducting a comprehensive review of options available to accelerate delivery of value for the benefit of our shareholders.

“The events of the last week have highlighted the need to capture more quickly the value we see in Unilever. We expect the review to be completed by early April, after which we will communicate further.”

The company then subsequently told The Financial Times it aims to boost operating profit margins to meet “the upper end of its 40-80 basis points guidance”.

Under the guidance of Polman and chief marketing officer Keith Weed, Unilever has long focused on sustainable business practices and growth over short-term gains. Earlier this year, it released a report claiming more than a third of global consumers now base purchase decisions on brands’ social and environmental impact.

“This research confirms that sustainability isn’t a nice-to-have for businesses. In fact, the very opposite is true,” said Weed.

“To succeed globally, and especially in emerging economies across Asia, Africa and Latin America, brands should go beyond traditional focus areas like product performance and affordability.

“Instead, they must act quickly to prove their social and environmental credentials and show consumers they can be trusted with the future of the planet and communities, as well as their own bottom lines.”


Source:
http://mandmglobal.com/unilever-commences-comprehensive-business-model-review-after-failed-kraft-heinz-bid/