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98-433: Clearblue was introduced in 1985 with the launch of the first Clearblue Home Pregnancy Test system, which at the time was owned by Unilever . It was the world’s first “rapid home test” that gave pregnancy test results in 30 minutes and allowed a woman to take a test before going to the doctor. The test was a three-step process using a dipstick and small tray. In 1988, Clearblue launched the first one-step pregnancy test with

196-401: A merger is the legal consolidation of two business entities into one, whereas an acquisition occurs when one entity takes ownership of another entity's share capital , equity interests or assets . From a legal and financial point of view, both mergers and acquisitions generally result in the consolidation of assets and liabilities under one entity, and the distinction between the two

294-405: A business retain just a handful of key players that would have otherwise left. Organizations should move rapidly to re-recruit key managers. It's much easier to succeed with a team of quality players that one selects deliberately rather than try to win a game with those who randomly show up to play. Mergers and acquisitions often create brand problems, beginning with what to call the company after

392-555: A business, which accrues to both categories of stakeholders, is called the Enterprise Value (EV), whereas the value which accrues just to shareholders is the Equity Value (also called market capitalization for publicly listed companies). Enterprise Value reflects a capital structure neutral valuation and is frequently a preferred way to compare value as it is not affected by a company's, or management's, strategic decision to fund

490-486: A certain size. An acquisition/takeover is the purchase of one business or company by another company or other business entity. Specific acquisition targets can be identified through myriad avenues, including market research, trade expos, sent up from internal business units, or supply chain analysis. Such purchase may be of 100%, or nearly 100%, of the assets or ownership equity of the acquired entity. A consolidation/amalgamation occurs when two companies combine to form

588-522: A colour cosmetics brand. In July, the company then announced that it had acquired the organic herbal tea business, Pukka Herbs. In September 2017, Unilever acquired Weis , an Australian ice cream business. Later that month Unilever acquired Remgro's interest in Unilever South Africa in exchange for the Unilever South Africa spreads business plus cash consideration. Even later that month, Unilever agreed to acquire Carver Korea, with 2.7billion USD,

686-546: A dual hormone read, detecting both estrogen and LH. In 2017, Clearblue launched the Clearblue® Connected Ovulation Test System. The Clearblue Connected Ovulation Test System connects via Bluetooth® to a users phone – it was the first test system tracking 2 hormones and connecting to the user's phone. Results are synced and displayed on the phone together with a monthly calendar, cycle comparison charts. Users can also set smart reminders. Clearblue won

784-473: A function of their acquisition activity. Therefore, additional motives for merger and acquisition that may not add shareholder value include: The M&A process itself is a multifaceted which depends upon the type of merging companies. The M&A process results in the restructuring of a business's purpose, corporate governance and brand identity. An arm's length merger is a merger: ″The two elements are complementary and not substitutes. The first element

882-468: A hair care products business. In 2017, significantly smaller Kraft Heinz made a $ 143 billion bid for Unilever. The deal was declined by Unilever. On 20 April 2017, Unilever acquired Sir Kensington's, a New York–based condiment maker. On 15 May 2017, the company acquired the personal care and home care brands of Quala, a Latin American consumer goods company. In June, the company acquired Hourglass,

980-502: A holding company Unilever PLC and N.V. with Anglo-Dutch structure, which has its registered office at Port Sunlight in Merseyside, United Kingdom and its head office at Unilever House in London, United Kingdom. The company has been restructured several times, for example in 2018 and 2020 (see "history"). In 2018, Unilever announced its intention to simplify this structure by centralising

1078-433: A larger and/or longer-established company and retain the name of the latter for the post-acquisition combined entity. This is known as a reverse takeover . Another type of acquisition is the reverse merger , a form of transaction that enables a private company to be publicly listed in a relatively short time frame. A reverse merger is a type of merger where a privately held company, typically one with promising prospects and

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1176-587: A merger of UAC Ghana Limited and Lever Brothers Ghana Limited. In 1993, Unilever acquired Breyers from Kraft , which made the company the largest ice cream manufacturer in the United States. In the same year, it acquired the Isaly Klondike Company, makers of Klondike bar , and Popsicle Industries . In 1996, Unilever merged Elida Gibbs and Lever Brothers in its UK operations. It also purchased Helene Curtis , significantly expanding its presence in

1274-624: A merger of the operations of Dutch Margarine Unie and British soapmaker Lever Brothers , with the name of the resulting company a portmanteau of the name of both companies. In the 1930s, the business grew, and new ventures were launched in Africa and Latin America. During this time, Unilever acquired the United Africa Company , created from a merger of the African & Eastern Trade Corporation and

1372-426: A merger or acquisition transaction can range from political to tactical. Ego can drive choice just as well as rational factors such as brand value and costs involved with changing brands. Beyond the bigger issue of what to call the company after the transaction comes the ongoing detailed choices about what divisional, product and service brands to keep. The detailed decisions about the brand portfolio are covered under

1470-444: A need for financing, acquires a publicly listed shell company that has few assets and no significant business operations. The combined evidence suggests that the shareholders of acquired firms realize significant positive "abnormal returns," while shareholders of the acquiring company are most likely to experience a negative wealth effect. Most studies indicate that M&A transactions have a positive net effect, with investors in both

1568-433: A new enterprise altogether, and neither of the previous companies remains independently owned. Acquisitions are divided into "private" and "public" acquisitions, depending on whether the acquiree or merging company (also termed a target ) is or is not publicly listed. Some public companies rely on acquisitions as an important value creation strategy. An additional dimension or categorization consists of whether an acquisition

1666-758: A new stand-alone beauty business, Elida Beauty, which will own and manage the following brands: Brut, Brylcreem, Timotei, Q-tips, Noxema, TIGI, VO5, Toni & Guy, Matey, Moussel, Monsavon, Impulse, St Ives, Alberto Balsam, Badedas, Fissan, Pento, Pond's, Careess, Lever 2000, Williams, Elida, and Alberto. In August 2021, Florida governor Ron DeSantis placed Unilever on a list of "Scrutinized Companies that Boycott Israel" because it had "no current plan to prevent Ben & Jerry's from terminating business activities in Israeli-controlled territories". The ice-cream brand has 90 days to stop engaging in "the BDS movement ", or

1764-612: A result, Unilever began to operate a "hands-off" policy towards the subsidiaries and left American management to its own devices. Sunsilk was first launched in the United Kingdom in 1954. Dove was first launched in the US in 1957. Unilever took full ownership of Frosted Foods in 1957, which it renamed Birds Eye . The US-based Good Humor ice cream business was acquired in 1961. By the mid-1960s, laundry soap and edible fats still contributed around half of Unilever's corporate profits. However,

1862-434: A situation where one company splits into two, generating a second company which may or may not become separately listed on a stock exchange. As per knowledge-based views, firms can generate greater values through the retention of knowledge-based resources which they generate and integrate. Extracting technological benefits during and after acquisition is an ever-challenging issue because of organizational differences. Based on

1960-693: A skincare business brand of AHC in North Asia. In October 2017, Unilever acquired Brazilian natural and organic food business Mãe Terra. In November, Unilever announced an agreement to acquire the Tazo speciality tea brand from Starbucks . Later in November 2017, the company acquired Sundial Brands, a skincare company. In December 2017, Unilever acquired Schmidt's Naturals , a US natural deodorant and soap company. In December 2017, Unilever sold its margarine and spreads division to investment firm KKR for €6.8bn. The sale

2058-550: A special committee of independent directors; and 2) conditioned on an affirmative vote of a majority of the minority stockholders, the business judgment standard of review should presumptively apply, and any plaintiff ought to have to plead particularized facts that, if true, support an inference that, despite the facially fair process, the merger was tainted because of fiduciary wrongdoing.″ A Strategic merger usually refers to long-term strategic holding of target (Acquired) firm. This type of M&A process aims at creating synergies in

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2156-481: A stagnant market for yellow fats (butter, margarine, and similar products) and increasing competition in detergents and soaps from Procter & Gamble forced Unilever to diversify. In 1971, Unilever acquired the British-based Lipton Ltd from Allied Suppliers . In 1978, National Starch was acquired for $ 487 million, marking the largest ever foreign-acquisition of a US company at that point. By

2254-468: A total value of US$ 2,164.4 bil. Some of the largest mergers of equals took place during the dot-com bubble of the late 1990s and in the year 2000: AOL and Time Warner (US$ 164 bil.), SmithKline Beecham and Glaxo Wellcome (US$ 75 bil.), Citicorp and Travelers Group (US$ 72 bil.). More recent examples this type of combinations are DuPont and Dow Chemical (US$ 62 bil.) and Praxair and Linde (US$ 35 bil.). An analysis of 1,600 companies across industries revealed

2352-456: Is friendly or hostile . Achieving acquisition success has proven to be very difficult, while various studies have shown that 50% of acquisitions were unsuccessful. "Serial acquirers" appear to be more successful with M&A than companies who make acquisitions only occasionally (see Douma & Schreuder, 2013, chapter 13). The new forms of buy out created since the crisis are based on serial type acquisitions known as an ECO Buyout which

2450-474: Is a co-community ownership buy out and the new generation buy outs of the MIBO (Management Involved or Management & Institution Buy Out) and MEIBO (Management & Employee Involved Buy Out). Whether a purchase is perceived as being "friendly" or "hostile" depends significantly on how the proposed acquisition is communicated to and perceived by the target company's board of directors, employees, and shareholders. It

2548-489: Is a major consumer goods company, with numerous household brands that touch the lives of millions of people every single day. Alere (a wholly owned subsidiary of Abbott) is among the world's leading providers of innovative diagnostic products, renowned for their proven reliability in the professional management of women’s health and chronic and infectious disease SPD is headquartered in Geneva, Switzerland . In addition to Clearblue,

2646-426: Is a triangular merger, where the target company merges with a shell company wholly owned by the buyer, thus becoming a subsidiary of the buyer. In a "forward triangular merger ", the target company merges into the subsidiary, with the subsidiary as the surviving company of the merger; a "reverse triangular merger" is similar except that the subsidiary merges into the target company, with the target company surviving

2744-425: Is between two competitors in the same industry. A vertical merger occurs when two firms combine across the value chain, such as when a firm buys a former supplier (backward integration) or a former customer (forward integration). When there is no strategic relatedness between an acquiring firm and its target, this is called a conglomerate merger (Douma & Schreuder, 2013). The form of merger most often employed

2842-399: Is combined into another entity by operation of the corporate law statute(s) of the jurisdiction of the merging entities. In a transaction structured as a merger or an equity purchase, the buyer acquires all of the assets and liabilities of the acquired entity. In a transaction structured as an asset purchase, the buyer and seller agree on which assets and liabilities the buyer will acquire from

2940-425: Is complete, the parties may proceed to draw up a definitive agreement, known as a "merger agreement", "share purchase agreement," or "asset purchase agreement" depending on the structure of the transaction. Such contracts are typically 80 to 100 pages long and focus on five key types of terms: Following the closing of a deal, adjustments may be made to some of the provisions outlined in the purchase agreement, such as

3038-497: Is executive director. Jope will be proposed as joint executive director at Unilever's 2019 AGM. Previously, Paul Polman was CEO for ten years, succeeding Patrick Cescau in 2009. In November 2019, Unilever announced that Nils Andersen would be replacing Chairman Marijn Dekkers, who stepped down after three years in the role. In January 2023, it announced Hein Schumacher as its new CEO, effective July 2023. The three markets of

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3136-426: Is important because the directors have the capability to act as effective and active bargaining agents, which disaggregated stockholders do not. But, because bargaining agents are not always effective or faithful, the second element is critical, because it gives the minority stockholders the opportunity to reject their agents' work. Therefore, when a merger with a controlling stockholder was: 1) negotiated and approved by

3234-412: Is normal for M&A deal communications to take place in a so-called "confidentiality bubble," wherein the flow of information is restricted pursuant to confidentiality agreements. In the case of a friendly transaction, the companies cooperate in negotiations; in the case of a hostile deal, the board and/or management of the target is unwilling to be bought or the target's board has no prior knowledge of

3332-702: Is not always clear. Most countries require mergers and acquisitions to comply with antitrust or competition law . In the United States , for example, the Clayton Act outlaws any merger or acquisition that may "substantially lessen competition" or "tend to create a monopoly ", and the Hart–Scott–Rodino Act requires notifying the U.S. Department of Justice 's Antitrust Division and the Federal Trade Commission about any merger or acquisition over

3430-517: Is now made up of 25 distinct symbols, each icon representing one of the company's sub-brands or its corporate values. The brand identity was developed around the idea of "adding vitality to life". Unilever's largest brands include Dove , Knorr , Axe (Lynx) , Ben & Jerry's , Hellmann's , Lifebuoy , Lux , Magnum , Omo (Persil) , Rexona , Sunlight , Sunsilk , and Wall's (Heartbrand) . Mergers and acquisitions Mergers and acquisitions ( M&A ) are business transactions in which

3528-415: Is possible only when resources are exchanged and managed without affecting their independence. A corporate acquisition can be structured legally as either an "asset purchase" in which the seller sells business assets and liabilities to the buyer, an "equity purchase" in which the buyer purchases equity interests in a target company from one or more selling shareholders or a "merger" in which one legal entity

3626-460: Is provided by full-service investment banks- who often advise and handle the biggest deals in the world (called bulge bracket ) - and specialist M&A firms, who provide M&A only advisory, generally to mid-market, select industries and SBEs. Highly focused and specialized M&A advice investment banks are called boutique investment banks . The dominant rationale used to explain M&;A activity

3724-487: Is that acquiring firms seek improved financial performance or reduce risk. The following motives are considered to improve financial performance or reduce risk: Megadeals—deals of at least one $ 1 billion in size—tend to fall into four discrete categories: consolidation, capabilities extension, technology-driven market transformation, and going private. On average and across the most commonly studied variables, acquiring firms' financial performance does not positively change as

3822-534: Is the largest producer of soap in the world, and its products are available in over 190 countries. The company is organised into five business groups: Beauty & Wellbeing, Personal Care, Home Care, Nutrition, and Ice Cream. It has research and development facilities in China, India, the Netherlands, Pakistan, the United Kingdom, and the United States. In the 1930s, Unilever acquired the United Africa Company . During

3920-644: The Birds Eye brand in the UK) and Batchelors Peas , one of the largest vegetables canners in the United Kingdom. In 1944, Pepsodent was acquired. In 1933, Unilever Indonesia was established in December as Lever Zeepfabrieken N.V. and had operations in Cikarang , West Java at Rungkut , East Java and North Sumatra . After 1945, Unilever's once-successful American businesses (Lever Brothers and T.J. Lipton) began to decline. As

4018-521: The Hudson's Bay Company merged with the rival North West Company . The Great Merger Movement was a predominantly U.S. business phenomenon that happened from 1895 to 1905. During this time, small firms with little market share consolidated with similar firms to form large, powerful institutions that dominated their markets, such as the Standard Oil Company , which at its height controlled nearly 90% of

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4116-582: The Royal Niger Company , which oversaw British trade interests in present-day Nigeria during the colonial era. The Nazi occupation of Europe during the Second World War meant that Unilever was unable to reinvest its capital into Europe, so it instead acquired new businesses in the United Kingdom and the United States. In 1943, it acquired T. J. Lipton , a majority stake in Frosted Foods (owner of

4214-496: The merger of British soap maker Lever Brothers and Dutch margarine producer Margarine Unie . It is headquartered in London , England . The company's products include baby food, beauty products, bottled water, breakfast cereals, cleaning agents, condiments , dairy products , energy drinks, healthcare and hygiene products, ice cream , instant coffee , instant noodles , pet food, pharmaceuticals, soft drinks, tea, and toothpaste. It

4312-615: The 2010s, under the leadership of Paul Polman , the company gradually shifted its focus towards health and beauty brands and away from food brands that showed slow growth. Unilever has a primary listing on the London Stock Exchange and a secondary listing on the Euronext Amsterdam , and is a constituent of the FTSE 100 Index and the AEX index . In September 1929, Unilever was formed by

4410-637: The 2012 Red Dot Design Award in the product design category for its Clearblue Plus Pregnancy Test. Its ergonomic design aimed to make the test easy to use. The Clearblue Digital Ovulation test was the 2011 Platinum winner in the Prima Baby Reader Awards. In 2019 Clearblue’s Connected Ovulation Test System won the European New Product of the Year Award by Nicholas Hall, sponsored by OTC New Products Tracker and Most Innovative New OTC Product in

4508-791: The Great Merger Movement were able to keep their dominance in their respective sectors through 1929, and in some cases today, due to growing technological advances of their products, patents , and brand recognition by their customers. There were also other companies that held the greatest market share in 1905 but at the same time did not have the competitive advantages of the companies like DuPont and General Electric . These companies such as International Paper and American Chicle saw their market share decrease significantly by 1929 as smaller competitors joined forces with each other and provided much more competition. The companies that merged were mass producers of homogeneous goods that could exploit

4606-472: The N.V. to merge into the PLC. In October 2020 Unilever announced that 99 per cent of shareholders in its UK arm agreed with the merger, i.e., voted to base the group in London. The completion of the unification was announced on 30 November 2020. Since then there is one class of shares. In January 2019, Alan Jope succeeded Paul Polman as the chief executive officer. The chief financial officer, Graeme Pitkethly,

4704-574: The UK OTC Marketing Awards 2019https://pharmaintelligence.informa.com/events/awards/otc-marketing-awards-2019/winners-2019 Clearblue partnered with Tommy’s Charity in the UK in 2018-2019 to promote the importance of preparing for pregnancy. In 2019, Clearblue, in partnership with the Be My Eyes app, launched the first service of its kind for their blind and low vision users of Clearblue. Clearblue

4802-497: The UK, it merged its Lever Brothers and Elida Fabergé businesses as Lever Fabergé in January 2001. In 2003, Unilever announced the sale of the Dalda brand in both India and Pakistan . In 2003, Bunge Limited acquired the Dalda brand from Hindustan Unilever Limited for reportedly under Rs 1 billion. On 30 March 2004, Unilever Pakistan accepted an offer of Rs. 1.33 billion for

4900-483: The United Kingdom's ninth best private sector employer based on millions of employee ratings and reviews. In 2020, Unilever announced it has reviewed its corporate structure again and that the company was to merge Unilever N.V. into Unilever PLC forming one holding company to be based in the United Kingdom. However, a Dutch 'exit tax' plan would require Unilever to reconsider this unification. In September 2020 Unilever's Dutch arm shareholders overwhelmingly voted for

4998-497: The United States shampoo and deodorant market. The purchase brought Unilever the Suave and Finesse hair-care product brands and Degree deodorant brand. In 1997, Unilever sold its speciality chemicals division, including National Starch & Chemical, Quest , Unichema and Crosfield to Imperial Chemical Industries for £4.9 billion. In 1998, Unilever established a sustainable agriculture programme. In 2000, Unilever acquired

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5096-429: The United States, China and India account for over one third of turnover. Thirteen brands account for over half of sales. Unilever's largest international competitors are Nestlé and Procter & Gamble . In 1930, the logo of Unilever was in a sans-serif typeface and all-caps. The current Unilever corporate logo was introduced in 2004 and was designed by Wolff Olins , a brand consultancy agency. The 'U' shape

5194-450: The acquiring company's stock, issued to the shareholders of the acquired company at a given ratio proportional to the valuation of the latter. They receive stock in the company that is purchasing the smaller subsidiary. There are some elements to think about when choosing the form of payment. When submitting an offer, the acquiring firm should consider other potential bidders and think strategically. The form of payment might be decisive for

5292-512: The acquisition so the team can focus on projects for their new employer). In recent years, these types of acquisitions have become common in the technology industry, where major web companies such as Facebook , Twitter , and Yahoo! have frequently used talent acquisitions to add expertise in particular areas to their workforces. Merger of equals is often a combination of companies of a similar size. Since 1990, there have been more than 625 M&A transactions announced as mergers of equals with

5390-514: The assets and liabilities that pertain solely to the unit being sold, determining whether the unit relies on services from other parts of the seller's organization, transferring employees, moving permits and licenses, and safeguarding against potential competition from the seller in the same business sector after the transaction is completed. From an economic point of view, business combinations can also be classified as horizontal, vertical and conglomerate mergers (or acquisitions). A horizontal merger

5488-562: The boutique mustard retailer Maille, Ben & Jerry's and SlimFast for £1.63 billion, Bestfoods for £13.4 billion. The Bestfoods acquisition increased Unilever's scale in foods in America, and added brands including Knorr , Marmite , Bovril , and Hellmann's to its portfolio. In exchange for European regulatory approval of the deal, Unilever divested itself of Oxo , Lesieur, McDonnells, Bla Band, Royco, and Batchelors . In 2001, Unilever split into two divisions: one for foods and one for home and personal care. In

5586-610: The brands Mazola, Argo & Kingsfords, Karo, Golden Griddle, and Henri's, along with several of its Canadian brands, to ACH Food Companies, an American subsidiary of Associated British Foods . In 2004, Unilever Bangladesh, which was established in 1964 changed its former name Lever Brothers Bangladesh Ltd to its present name in December 2004, is owned 60.4% by Unilever and 39.6% by the Government of Bangladesh . In 2007, Unilever partnered with Rainforest Alliance to sustainably source all its tea. In 2009, Unilever agreed to acquire

5684-446: The business either through debt, equity, or a portion of both. Five common ways to "triangulate" the enterprise value of a business are: Professionals who value businesses generally do not use just one method, but a combination. Valuations implied using these methodologies can prove different to a company's current trading valuation. For public companies, the market based enterprise value and equity value can be calculated by referring to

5782-482: The buyer and target companies seeing positive returns. This suggests that M&A creates economic value, likely by transferring assets to more efficient management teams who can better utilize them. (See Douma & Schreuder, 2013, chapter 13). There are also a variety of structures used in securing control over the assets of a company, which have different tax and regulatory implications: The terms " demerger ", " spin-off " and "spin-out" are sometimes used to indicate

5880-469: The buyer. Hence, the analysis should be done from the acquiring firm's point of view. Synergy-creating investments are started by the choice of the acquirer, and therefore they are not obligatory, making them essentially real options . To include this real options aspect into analysis of acquisition targets is one interesting issue that has been studied lately. See also contingent value rights . Mergers are generally differentiated from acquisitions partly by

5978-612: The company also manufactures and distributes other consumer diagnostic products. The Clearblue research and development facility - the Clearblue Innovation Center - is based in Bedford, United Kingdom, and employs over 150 people. The Research Center has conducted over 180 clinical studies involving over 300,000 clinical trial participants. Unilever Unilever PLC is a British multinational fast-moving consumer goods company founded on 2 September 1929 following

SECTION 60

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6076-502: The company would sell Elida Beauty to Yellow Wood Partners, a private equity firm in the United States. In March 2024, Unilever announced plans to spin off its ice cream unit, which makes among others, brands such as Magnum and Ben & Jerry's, into a standalone business starting in March 2024 and planned to complete by the end of 2025. The announcement was part of a cost-savings programme that would cut 7,500 jobs. Unilever has

6174-462: The company's current account), liquidity ratios might decrease. On the other hand, in a pure stock for stock transaction (financed from the issuance of new shares), the company might show lower profitability ratios (e.g. ROA). However, economic dilution must prevail towards accounting dilution when making the choice. The form of payment and financing options are tightly linked. If the buyer pays cash, there are three main financing options: M&A advice

6272-469: The company's share price and components on its balance sheet. The valuation methods described above represent ways to determine value of a company independently from how the market currently, or historically, has determined value based on the price of its outstanding securities. Most often value is expressed in a Letter of Opinion of Value (LOV) when the business is being valued informally. Formal valuation reports generally get more detailed and expensive as

6370-420: The content analysis of seven interviews, the authors concluded the following components for their grounded model of acquisition: An increase in acquisitions in the global business environment requires enterprises to evaluate the key stake holders of acquisitions very carefully before implementation. It is imperative for the acquirer to understand this relationship and apply it to its advantage. Employee retention

6468-430: The control of the buyer modified. If the issuance of shares is necessary, shareholders of the acquiring company might prevent such capital increase at the general meeting of shareholders. The risk is removed with a cash transaction. Then, the balance sheet of the buyer will be modified and the decision maker should take into account the effects on the reported financial results. For example, in a pure cash deal (financed from

6566-512: The duality of legal entities and keeping just one headquarters in Rotterdam, abandoning the London head office. Business groups and staff would have been unaffected, as would the dual listing. On 5 October 2018 the group announced it would cancel the restructuring due to concern that the United Kingdom shareholders would lose value if the company fell out of the London FTSE100. A shareholder vote

6664-405: The efficiencies of large volume production. In addition, many of these mergers were capital-intensive. Due to high fixed costs, when demand fell, these newly merged companies had an incentive to maintain output and reduce prices. However more often than not mergers were "quick mergers". These "quick mergers" involved mergers of companies with unrelated technology and different management. As a result,

6762-468: The efficiency gains associated with mergers were not present. The new and bigger company would actually face higher costs than competitors because of these technological and managerial differences. Thus, the mergers were not done to see large efficiency gains, they were in fact done because that was the trend at the time. Companies which had specific fine products, like fine writing paper, earned their profits on high margin rather than volume and took no part in

6860-517: The end of the 1970s through acquisitions, Unilever had gained 30 per cent of the Western European ice cream market. In 1982, Unilever management decided to reposition itself from an unwieldy conglomerate to a more concentrated fast-moving consumer goods (FMCG) company. In 1984, Unilever acquired Brooke Bond (maker of PG Tips tea) for £390 million in the company's first successful takeover . In 1986, Unilever strengthened its position in

6958-505: The first one-step home ovulation test, enabling women to measure their surge in Luteinising Hormone (LH) to determine their most fertile days. In 1999, the brand launched the world’s first dual-hormone fertility monitor, which allowed women to measure estrone3-glucuronide ( estrogen ) in combination with LH. The company created the first digital ovulation test in 2004. In 2013, the company also began offering an ovulation test with

7056-473: The global oil refinery industry. It is estimated that more than 1,800 of these firms disappeared into consolidations, many of which acquired substantial shares of the markets in which they operated. The vehicle used were so-called trusts . In 1900 the value of firms acquired in mergers was 20% of GDP . In 1990 the value was only 3% and from 1998 to 2000 it was around 10–11% of GDP. Companies such as DuPont , U.S. Steel , and General Electric that merged during

7154-792: The invention of lateral flow technology. This one-step test gave a result in 3 minutes, subsequently reduced to a 1-minute result when Clearblue introduced the world’s first one-minute home pregnancy test in 1996. In 2003, Clearblue released the first digital pregnancy test to show the result in words ‘Pregnant’ or ‘Not Pregnant’ on a digital screen. In 2008, Clearblue launched the Clearblue Digital Pregnancy Test with Conception Indicator, which sells in Europe. Clearblue has also launched ovulation and fertility home diagnostic products to help women identify their fertile days and to maximize their chances of conception. In 1989, Clearblue released

7252-440: The long run by increased market share, broad customer base, and corporate strength of business. A strategic acquirer may also be willing to pay a premium offer to target firm in the outlook of the synergy value created after M&A process. The term "acqui-hire" is used to refer to acquisitions where the acquiring company seeks to obtain the target company's talent, rather than their products (which are often discontinued as part of

7350-440: The merger. Mergers, asset purchases and equity purchases are each taxed differently, and the most beneficial structure for tax purposes is highly situation-dependent. Under the U.S. Internal Revenue Code , a forward triangular merger is taxed as if the target company sold its assets to the shell company and then liquidated, them whereas a reverse triangular merger is taxed as if the target company's shareholders sold their stock in

7448-429: The most value from a business assessment, objectives should be clearly defined and the right resources should be chosen to conduct the assessment in the available timeframe. As synergy plays a large role in the valuation of acquisitions, it is paramount to get the value of synergies right; as briefly alluded to re DCF valuations. Synergies are different from the "sales price" valuation of the firm, as they will accrue to

7546-417: The offer. Hostile acquisitions can, and often do, ultimately become "friendly" as the acquirer secures endorsement of the transaction from the board of the acquiree company. This usually requires an improvement in the terms of the offer and/or through negotiation. "Acquisition" usually refers to a purchase of a smaller firm by a larger one. Sometimes, however, a smaller firm will acquire management control of

7644-431: The ownership of companies , business organizations , or their operating units are transferred to or consolidated with another company or business organization. This could happen through direct absorption, a merger, a tender offer or a hostile takeover. As an aspect of strategic management , M&A can allow enterprises to grow or downsize , and change the nature of their business or competitive position. Technically,

7742-929: The personal care business of Sara Lee Corporation , including brands such as Radox , Badedas and Duschdas. The Sara Lee acquisition was completed on 6 December 2010. In 2010, Unilever acquired the Diplom-Is in Denmark, Unilever announced that it had entered into a definitive agreement to sell its consumer tomato products business in Brazil to Cargill , purchased Alberto-Culver , a maker of personal care and household products including Simple, VO5 , Nexxus , TRESemmé , and Mrs. Dash , for US$ 3.7 billion. acquired EVGA 's ice cream brands, which included Scandal, Variete and Karabola, and its distribution network in Greece, for an undisclosed amount. In 2012, Unilever announced it would phase out

7840-446: The purchase price. These adjustments are subject to enforceability issues in certain situations. Alternatively, certain transactions use the 'locked box' approach, where the purchase price is fixed at signing and based on the seller's equity value at a pre-signing date and an interest charge. The assets of a business are pledged to two categories of stakeholders: equity owners and owners of the business' outstanding debt. The core value of

7938-446: The rewards for M&A activity were greater for consumer products companies than the average company. For the period 2000–2010, consumer products companies turned in an average annual TSR of 7.4%, while the average for all companies was 4.8%. Given that the cost of replacing an executive can run over 100% of his or her annual salary, any investment of time and energy in re-recruitment will likely pay for itself many times over if it helps

8036-479: The sale of its Dalda brand and related business of edible oils and fats to the newly incorporated company Dalda Foods (Pvt.) Limited. In 2002, the company sold its speciality oils and fats division, known as Loders Croklaan, for RM814 million (€218.5 million) to IOI Corporation , a Kuala Lumpur, Malaysia–based oil palm company. As part of the deal, the Loders Croklaan name was maintained. Unilever sold

8134-542: The second half of the 20th century, the company increasingly diversified from being a maker of products made of oils and fats, and expanded its operations worldwide. It has made numerous corporate acquisitions, including Lipton (1971), Brooke Bond (1984), Pond's (1987), Hellmann's (2000), Ben & Jerry's (2000), SlimFast (2000), Knorr (2000), Alberto-Culver (2010), Dollar Shave Club (2016), and Pukka Herbs (2017). Unilever divested its speciality chemicals businesses to Imperial Chemical Industries in 1997. In

8232-448: The seller. Asset purchases are common in technology transactions in which the buyer is most interested in particular intellectual property but does not want to acquire liabilities or other contractual relationships. An asset purchase structure may also be used when the buyer wishes to buy a particular division or unit of a company that is not a separate legal entity. Divestitures present a variety of unique challenges, such as identifying

8330-442: The seller. With pure cash deals, there is no doubt on the real value of the bid (without considering an eventual earnout). The contingency of the share payment is indeed removed. Thus, a cash offer preempts competitors better than securities. Taxes are a second element to consider and should be evaluated with the counsel of competent tax and accounting advisers. Third, with a share deal the buyer's capital structure might be affected and

8428-414: The size of a company increases, but this is not always the case as the nature of the business and the industry it is operating in can influence the complexity of the valuation task. Objectively evaluating the historical and prospective performance of a business is a challenge faced by many. Generally, parties rely on independent third parties to conduct due diligence studies or business assessments. To yield

8526-672: The state will no longer contract with the parent company Unilever or any of its subsidiaries. In November 2021, Unilever agreed to sell most of its tea business under the Ekaterra division to investment firm CVC Capital Partners for €4.5 billion. This deal excluded the Unilever tea business in India, Indonesia and Nepal, and the Lipton Ice Tea joint-venture with PepsiCo. The deal was completed in summer 2022. In December 2023, Unilever announced

8624-490: The target company to the buyer. The documentation of an M&A transaction often begins with a letter of intent . The letter of intent generally does not bind the parties to commit to a transaction, but may bind the parties to confidentiality and exclusivity obligations so that the transaction can be considered through a due diligence process involving lawyers, accountants, tax advisors, and other professionals, as well as business people from both sides. After due diligence

8722-632: The topic brand architecture . Most histories of M&A begin in the late 19th century United States. However, mergers coincide historically with the existence of companies. In 1708, for example, the East India Company merged with an erstwhile competitor to restore its monopoly over the Indian trade. In 1784, the Italian Monte dei Paschi and Monte Pio banks were united as the Monti Reuniti. In 1821,

8820-547: The transaction and going down into detail about what to do about overlapping and competing product brands. Decisions about what brand equity to write off are not inconsequential. And, given the ability for the right brand choices to drive preference and earn a price premium, the future success of a merger or acquisition depends on making wise brand choices. Brand decision-makers essentially can choose from four different approaches to dealing with naming issues, each with specific pros and cons: The factors influencing brand decisions in

8918-629: The use of microplastics in the form of microbeads in their personal care products by 2015. In 2014, Unilever agreed to acquire a majority stake in the China-based water purification company Qinyuan for an undisclosed price, acquired Talenti Gelato & Sorbetto, acquired Camay brand globally and the Zest brand outside of North America and the Caribbean from Procter & Gamble . In 2015, Unilever acquired British niche skincare brand REN Skincare, This

9016-406: The way in which they are financed and partly by the relative size of the companies. Various methods of financing an M&A deal exist: Payment by cash. Such transactions are usually termed acquisitions rather than mergers because the shareholders of the target company are removed from the picture and the target comes under the (indirect) control of the bidder's shareholders. Payment in the form of

9114-515: The world skin care market by acquiring Ponds (merged from Chesebrough Manufacturing and Pond's Creams ), the maker of Ragú , Pond's , Aqua-Net, Cutex , and Vaseline in another hostile takeover. In 1989, Unilever bought Calvin Klein Cosmetics, Fabergé , and Elizabeth Arden , but the latter was later sold (in 2000) to FFI Fragrances. In 1992, Unilever Ghana was established in July following

9212-484: Was a donor to Flight for Every Mother Ltd, a humanitarian project led by Dr. Sophia Webster which aimed to improve maternal health in Africa. SPD was formed in 2007 as a joint venture, between Procter & Gamble (P&G) and Alere (now a part of the Abbott group, since October 2017) to create, using its parent companies’ complementary strengths, one of the world's foremost organisations in consumer diagnostics. P&G

9310-413: Was completed in July 2018, and the new company was named Upfield . Upfield's notable brands include Flora , Stork , I Can't Believe It's Not Butter , Rama , Country Crock , Becel , and Blue Band . Unilever announced that to help tackle the global COVID-19 pandemic , it would contribute over € 100m through donations of soap, hand sanitiser, bleach and food. In April 2021, Unilever established

9408-521: Was followed in May 2015 by the acquisition of Kate Somerville Skincare LLC. The company also acquired the Italian premium ice cream maker GROM for an undisclosed amount. Unilever also separated its food spreads business, including its Flora and I Can't Believe It's Not Butter! brands, into a standalone entity named Unilever Baking, Cooking and Spreading. The separation was first announced in December 2014 and

9506-536: Was made in response to declining worldwide sales in that product category. Unilever bought the United States–based startup company Dollar Shave Club for a reported $ 1b (£764m) to compete in the male grooming market. On 16 August 2016, Unilever acquired Blueair, a supplier of mobile indoor air purification technologies. In September 2016, Unilever acquired Seventh Generation Inc. for $ 700 million. On 16 December 2016, Unilever acquired Living Proof Inc,

9604-559: Was planned to decide for the listing of a new Unilever Dutch entity, which would have seen Unilever dropping out of the FTSE 100 Index . When it appeared that the vote would fail, due to uncertainty over the Netherlands dividend tax, the scheme was cancelled on 5 October 2018. In October 2018, it acquired a 75% stake in the Italian personal-care business Equilibra and acquired the high-end, eco-friendly laundry and household cleaning products company The Laundress for an undisclosed sum. In 2018, UK recruitment website Indeed, named Unilever as

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