Unilever to hive off specialities
15 Jan 2000
Unilever has decided that it wants to be a consumer products group. The company's diverse speciality chemicals operations are to be sold off, which could net the company some £6billion.
The company has four specialities businesses, with a total turnover of some £3billion last year, representing 9 per cent of Unilever's total revenues. It also accounts for almost 15 per cent of the group's £1.5billion-plus profits. `These speciality chemicals businesses have developed significantly over the past two decades and are strong and profitable, with leading global positions,' commented chief executive Niall FitzGerald.
The businesses are Quest International, involved in fragrances, food flavourings and ingredients; Unichema, world leader in speciality oleochemicals and nickel catalysts; National Starch and Chemical Company which makes industrial adhesives (in which it is the market leader), resins and specialities; and Crosfield, which manufactures particulate products from silica and alumina. The first two firms are based in the Netherlands; National Starch is headquartered in the US; and Crosfield is based in the UK. The four businesses employ over 15 800 people, and operate in 35 countries. The spin-off to more dedicated buyers will help the businesses flourish, says FitzGerald: `The industry is currently undergoing considerable realignment and a sale of our businesses at this time would allow them to participate more effectively in the opportunities this presents.'
Only two businesses currently within the specialities portfolio will remain with Unilever. These are Unipath, which makes home pregnancy tests and other consumer diagnostics products; and Loders Croklaan, a speciality fats producer currently managed by Quest.
The sale will free up in excess of £6billion, which FitzGerald plans to spend on bolstering the company's food and consumer products divisions. Much of this is likely to be concentrated on the fast-growing markets in developing regions, particularly China, India, Southeast Asia, southern Latin America and central and eastern Europe.
