Unilever slumps as Kraft Heinz pulls bid; U.S. markets shut for holiday

Feb 22, 2017, 00:36
Unilever slumps as Kraft Heinz pulls bid; U.S. markets shut for holiday

Kraft spokesperson Michael Mullen said that while the company had meant to "proceed on a friendly basis" for the acquisition, "it was made clear Unilever did not wish to pursue a transaction".

Kraft Heinz planned to buy its bigger rival, combining two of the world's largest packaged food and consumer goods companies, but Unilever flatly rejected the offer on Friday.

Henderson Group Plc's John Bennett, who oversees more than $12 billion, is betting that a failed bid for Unilever may lead the owner of brands like Ben & Jerry's ice cream and Dove soap to consider selling some of its assets. Its top US food brands include Knorr, Hellmann's and Lipton.

The two companies said in a press release they hold each other in high regard and that Kraft Heinz has the utmost respect for the culture, strategy and leadership of Unilever.

Analysts say Kraft Heinz, co-headquartered in Chicago and Pittsburgh, is still in the market for acquisitions.

Heinz purchased Kraft in a previous mega-deal in 2015.

(NYSE:HNZ) interest was made public at an extremely early stage, said company's spokesman Michael Mullen in a statement.

People familiar with the talks at the weekend said 3G and Berkshire decided Unilever's negative response made a friendly transaction impossible, Bloomberg reported.

Unilever has a track record of investing in sustainable and ethical business, while Kraft Foods - one of the two constituent parts of Kraft Heinz - was criticised in the United Kingdom following its successful takeover bid for Cadbury in 2009. Unilever said the deal "fundamentally under values Unilever" and has "no merit, either financial or strategic, for Unilever shareholders".

The company's stock plummeted, even though most of the European indices opened on a bullish note, due to Kraft Heinz's most recent announcement stating that the company is withdrawing their initial acquisition proposal for Unilever, which was rejected by the latter right away upon the proposal's announcement.

Kathleen Brooks, research director at City Index Direct, said: "We expect the chief reason to drop the bid was concern about the political atmosphere in Britain, which is now against foreigners making bids for "national treasures", even half-Dutch ones like Unilever".

Kraft Heinz's stock (NASDAQ: KHC) climbed 10.74% or $9.37 at $96.65 in the market, reaching a high of $97.77 with a market cap of $112.72 billion and dividend yield of 2.48%.

YOU MIGHT ALSO LIKE
  • IPhone 8 to ditch the home button for

    IPhone 8 to ditch the home button for "function area"

    According to Ming-Chi Kuo, the upcoming device will feature a "function area" that will display virtual buttons. Although, there would be two other iPhone models so the hefty price tag may not impact the sales directly.
    IPhone 8 to come with wireless charging

    IPhone 8 to come with wireless charging

    Obviously, the inclusion of such an advanced feature would have repercussions, and one of them is the possible death of Touch ID. This year's iPhone would likely be a major overhaul with new technologies that are going to make it a game changer.
    Carmelo Anthony replaces injured Kevin Love in All-Star Game

    Carmelo Anthony replaces injured Kevin Love in All-Star Game

    In his last five games, Anthony is averaging 28.4 points on 54.1 percent shooting overall and 58.1 percent from deep. Only 33 players have been selected more often in league history.
  • Lidl to open 20 stores in United States this summer

    Lidl (pronounced LEE-dul) established its North American headquarters in Crystal City in 2015 as a base for its USA expansion. According to The Washington Post , Lidl's USA store prototype is much larger than a typical European location.

    More than 500 Calif. inmates evacuated due to dam flooding dangers

    They are trying to sure up the emergency spillway and decrease water levels at Oroville Dam before Thursday's expected rainfall. The damage occurred even though the spillway was created to handle much more water than the amount that overflowed.
    Trump welcomes Canada's prime minister in test of neighborly relations

    Trump welcomes Canada's prime minister in test of neighborly relations

    During his prepared remarks, Trump highlighted some of the ways that he feels the US and Canada will work together. Prime Minister, that I'm focused and you're focused on the important role women play in our economies.
  • President's Day 2017: Best Funny Memes About Nearly Every US President

    President's Day 2017: Best Funny Memes About Nearly Every US President

    The weather was rough enough to force the cancellation of one of two scheduled "Not My Presidents Day" rallies in San Francisco. Pennington County Republicans rallied directly across the street from those opposing President Donald Trump.
    XBox Project Scorpio Featured at Microsoft's E3 2017 Event

    XBox Project Scorpio Featured at Microsoft's E3 2017 Event

    The Xbox One Beam app will be available to all Xbox One users later this Spring once the Creators Update rolls out to everyone. Gamespot also reported that Xbox's big boss Phil Spencer teased the Microsoft E3 2017 lineup in January.
    Real Madrid's Ramos considers changing his shirt number to 93

    Real Madrid's Ramos considers changing his shirt number to 93

    Cristiano Ronaldo has set a new personal best for assists in a single Champions League campaign with Real Madrid . Zidane called on his players to shut Napoli out at the Santiago Bernabeu in his pre-match conference yesterday.
  • NASA launch postponed due to steering issues

    NASA launch postponed due to steering issues

    SpaceX's Falcon 9 rocket successfully lifted off from a NASA launchpad that was once used by Apollo astronauts. It was the first SpaceX launch from Florida since a Falcon 9 exploded on a launch pad on September 1, 2016.
    NASA Is Inviting Public To Search For Possible Undiscovered Worlds

    NASA Is Inviting Public To Search For Possible Undiscovered Worlds

    The search also may discover more distant objects like brown dwarfs , sometimes called failed stars, in nearby interstellar space. The Backyard Worlds search works similarly, but by electronically serving up flipbooks of WISE images taken at different times.

    Trump names R. Alexander Acosta for Labor

    His last nominee, Andrew Puzder , withdrew on Wednesday, a day before he was scheduled to appear at a confirmation hearing. Acosta was a member of the National Labor Relations Board from 2002 to 2003 where he authored more than 125 opinions.
popular