Kraft Heinz drops it's 143 billion dollars offer for rival company Unilever | Progresiv
Kraft Heinz is dropping its $143 billion cash and stock offer for Anglo/Dutch consumer products giant Unilever just two days after revealing plans for what would have been one of the largest corporate takeovers in history. 
“Unilever and Kraft Heinz hereby announce that Kraft Heinz has amicably agreed to withdraw its proposal for a combination of the two companies,” the companies said in a joint statement. “Unilever and Kraft Heinz hold each other in high regard. Kraft Heinz has the utmost respect for the culture, strategy and leadership of Unilever,” they added.
Kraft Heinz blamed its withdrawn offer on early deal leaks, which it said thwarted efforts to negotiate a merger on a friendly basis. “Our intention was to proceed on a friendly basis, but it was made clear Unilever did not wish to pursue a transaction.” said Kraft Heinz spokesman Michael Mullen. “It is best to step away early so both companies can focus on their own independent plans to generate value,” he added in an emailed statement.
On Friday, a report by the Financial Times forced Kraft Heinz to disclose its unsolicited bid for Unilever, a conglomerate with consumer products and foods brands ranging from Axe deodorant to Hellmann’s mayonnaise, Dove soap, Ben & Jerry’s ice cream, SunSilk razor blades and Sun dishwasher fluid. Separately, Unilever said Kraft Heinz had offered $50 a share for the company, split between $30.23 a share in cash payable in U.S. dollars and 0.222 shares in the combined company, valuing the target at $143 billion.
The offer sent U.S.-listed Unilever shares surging 14% in Friday trading, while Kraft Heinz gained over 10%, hitting new record highs. However, the proposed takeover drew quick push back, mostly because Unilever is seen as pioneering in its long-term initiates like sustainability, while Kraft Heinz is known on Wall Street as a ruthless cost-cutter.
When rejecting Kraft Heinz’s proposal on Friday, Unilever said the bid ”fundamentally undervalues” the company and it “sees no merit, either financial or strategic, for Unilever’s shareholders.”
Kraft Heinz is backed by Berkshire Hathaway and it is run by Warren Buffett’s favorite deal-making partner, Brazilian private equity firm 3G Capital. (www.forbes.com)
