Unilever CEO Speaks of Expanding in U.S., Acquiring More Companies
July 21 2016 - 12:56PM
Dow Jones News
By Saabira Chaudhuri
LONDON-- Unilever PLC Chief Executive Paul Polman on Thursday
indicated the company isn't averse to making multibillion-dollar
acquisitions should the right opportunity arise, a day after the
consumer-goods giant said it was buying California startup Dollar
Shave Club.
Meeting with journalists in London following the announcement of
Unilever's first-half results, Mr. Polman said the company's
strategy has been to make roughly EUR2 billion ($2.2 billion) in
acquisitions a year, with the bulk of growth coming organically
through investments in existing brands.
Unilever has agreed to pay $1 billion in cash for Dollar Shave
Club, according to people familiar with that deal. The company last
spring bought four high-end skin-care brands and in October bought
Italian ice cream maker Grom.
Sitting at a table strewn with brands Unilever had acquired in
recent years, including Ren skin-care products and T2 tea, Mr.
Polman said the company would look at bigger deals along the lines
of its 2011 $3.7 billion acquisition of Alberto Culver "if it makes
sense." He declined to comment on specific categories in which
Unilever might seek acquisitions.
Unilever's first priority once it buys Dollar Shave Club will be
to accelerate its growth in the U.S., he said, after which the
company will work to implement lessons it gets from that business's
direct-to-consumer model across other units such as its T2 tea
brand and high-end beauty brands.
"We are actually buying one of the disrupters," he said. "We
will learn from that. We will disrupt ourselves."
Mr. Polman blamed the U.S. elections, Britain's vote to leave
the European Union, the coup attempt in Turkey and the presidential
impeachment in Brazil for creating sluggish demand in a string of
markets.
The Turkish coup attempt hurt Unilever's ice cream sales, Mr.
Polman said, adding that declines in tourism could lead to the
company having to close its ice cream factories there for a couple
of days.
He said Unilever would look to adjust prices in Britain to
compensate for the fall in the pound following Brexit, but he
declined to specify when and by how much. The company has 10
factories in the U.K., many of which make products that are
exported to Europe, he added.
Despite the geographic disruptions and continued difficulties in
businesses such as tea and spreads, Mr. Polman said Unilever's
diverse product and geographic mix positions it to ride out
volatility. "I've always said, don't worry about Unilever," he
said. "People who buy into Unilever buy into the total
company."
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
(END) Dow Jones Newswires
July 21, 2016 12:41 ET (16:41 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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