Unilever said it has bought back 25.75% shareholding in Unilever South Africa Holdings owned by Remgro in exchange for the Unilever Spreads business.
Under the agreement, Remgro will take over the spreads business in Southern Africa as well as a cash consideration of ZAR4.9 billion, representing a transaction value of ZAR11.9 billion.
This transaction values the Spreads business at ZAR7.0 billion, representing a 13.4 multiple of 2016 EBITDA.
Luc-Olivier Marquet, Executive Vice President of Unilever SA said: “Unilever South Africa is a great business, well positioned for sustainable long-term growth. By giving us full ownership of the business, this transaction means we are better placed to accelerate that growth while the Spreads business moves on to Remgro where it augments their current portfolio and can be sure of a great future”.
Jannie Durand, CEO of Remgro, said: “Through this transaction, Remgro has exchanged its minority stake in Unilever South Africa for full ownership and control of the Unilever Spreads business in South Africa, Botswana, Lesotho, Namibia and Swaziland plus cash. We believe the Unilever Spreads business in these Southern Africa countries is an attractive business, with leading brands which include Rama, Stork, Flora and Rondo with good growth prospects”.
“This transaction is a vote of confidence in the future of South Africa, Botswana, Lesotho, Namibia and Swaziland”.
“We thank Unilever for the longstanding relationship and wish Unilever and the employees of Unilever South Africa well for the future. We welcome the prospect of having the Spreads business as part of the Remgro Group”.
The transaction is subject to customary regulatory approvals.
Globally, Unilever had made it a strategic imperative to get out of the spreads business, In Nigeria, the group announced earlier this year that it will be selling its spreads business.
