Unilever chief under pressure after company walks away from GSK deal

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Unilever chief under pressure after company walks away from GSK deal via IrishTimesBiz

faces growing pressure to deliver a new strategy after investor dissent forced the Dove soap owner to walk away from a bid for GlaxoSmithKline ’s consumer products division.

The very public defeat, which came after analysts implored Unilever not to proceed and a big shareholder said management had “lost the plot,” was a flashback to Kraft Heinz’s failed bid to acquire the company in 2017 for $143 billion. That debacle prompted radical changes at Unilever, including consolidating its headquarters in the UK, ditching a cumbersome Anglo-Dutch structure, and adopting a more aggressive acquisition strategy that’s failed in its first big test.

In recent years, that arm of the company has been wounded by inflationary pressures in emerging markets that have slowed Unilever’s overall growth compared with archrivalStill, Unilever’s share price fell sharply as investors questioned the rationale for the Glaxo deal. Analysts wrote notes titled “Please Don’t” and described it as a “very bad deal”. Ratings agencies also warned about a possible downgrade of Unilever’s credit rating if it went ahead with a takeover.

 

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