How Unilever bosses have already cashed in on £115bn takeover
Huge bid made just 2 days after they picked up £3.3m in shares
THE takeover bid by US giant Kraft Heinz has handed bosses at Marmite maker Unilever a £500,000 windfall on shares they picked up two days earlier.
Unilever chief executive Paul Polman was among 13 executives at the firm given shares worth £3.3m on Wednesday.
Yesterday, the company’s value soared 13pc as it was revealed ketchup maker Kraft Heinz had staged an audacious takeover bid. It meant the board members of Unilever saw their shares climb by around £500,000. Polman, 60, who is renowned for his zany comments on the environment and business methods, made £150,000.
On top of this he saw his stake in the company, worth an estimated £10.4m yesterday morning, soar by £1.5m.
The surprise £115bn bid by Kraft Heinz, which was rejected by Unilever, would have been the second-biggest takeover deal in history, behind the £147bn swoop on Germany’s Mannesmann by Vodafone in 2000.
It could surpass this record with Kraft Heinz set to return to the bargaining table with a bigger bid, which must be by March 17 under US takeover rules.
The takeover would be a bumper payday for investment banks, stockbrokers, lawyers and other advisers. Lazard has been appointed to broker a deal for Kraft, while Morgan Stanley and Centerview are acting for Unilever, along with corporate brokers UBS and Deutsche.
Kraft made an offer 18pc above the value of the shares on Thursday that would see Unilever shareholders receive £40 a share in a mix of cash and equity. But the Anglo-Dutch company said the offer undervalued the firm, and added it had no merit.
Analysts predicted competition concerns, suggesting a deal might not get approval from regulators. Michael Hewson, analyst at CMC Markets, said: ‘The amount of costs that could well get stripped out of any combined entity is bound to worry governments in countries where Unilever has a significant number of employees, like the UK and Holland. UK authorities have already had experience of broken promises by Kraft in the Cadbury takeover a few years ago.’
For Kraft, the deal would help it to achieve explosive growth almost overnight. Steve Clayton, fund manager at Hargreaves Lansdown, said Unilever shareholders were in ‘no mood’ to accept a short-term premium in exchange for losing the growth the company could produce for decades to come. ‘To win over a majority of Unilever’s shareholders, we think Kraft Heinz will need to dig very deep indeed,’ he added.