How Unilever foiled Kraft Heinz's £115m takeover bid

Kraft Heinz's move to drop the proposal came after the company said on Friday that it had approached the Marmite owner with a $143-billion cash-and-share offer, confirming a report in FT Alphaville.

The deal would have been one of the largest ever in corporate history.

The fact that it made a bid for all of Unilever and not just its food business indicates that Kraft Heinz is potentially open to acquiring other packaged consumer goods, one analyst said.

Unilever released a statement saying: "Unilever and Kraft Heinz hereby announce that Kraft Heinz has amicably agreed to withdraw its proposal for a combination of the two companies". US food giant Kraft Heinz has called off its proposed takeover of Unilever, further weighing on markets on a light day on the economic front. However, on Friday, Feb. 17, the bid from Kraft Heinz was rejected by the British-Dutch company, which owns brands such as Lipton Tea and Dove Soap. Kraft Heinz's offer "fundamentally undervalues" the company, said Unilever at the time.

Kraft had offered Unilever $50.00 per share in a mix of $30.23 per share in cash payable in U.S. dollars and 0.222 new enlarged entity shares per existing Unilever share.

The stock had climbed 10.7 per cent to $96.65, giving it a market value of $130.2bn, as its investors anticipated the benefits of the company's next megadeal.

Nearly exactly 48 hours after Kraft Heinz's blockbuster $143 billion bid for Unilever went public, the company changed its mind. "There can be no certainty that any further formal proposal will be made to the Board of Unilever or that an offer will be made at all or as to the terms of any transaction".

Kraft Heinz makes Oscar Mayer luncheon meats, Philadelphia spreads and Maxwell House coffee, among other things.

However, it said there was "no certainty" a formal offer would be made.

Both also believed a protracted war of words was not in the best interest of Kraft and would risk souring future deal opportunities, the people said, asking not to be named because the process was private.

Unilever also saw its household products and consumer care divisions as too distinct from Kraft's food business, the people added.

  • Zachary Reyes