EC scrutinises Unilever’s purchase of Sara Lee

The number and breadth of brands involved in Unilever’s acquisition of the Personal Care and European Laundry business of the Sara Lee Corporation will now see the deal analysed market by market by the European Commission (EC).

Sara Lee brand Radox
Sara Lee brand Radox

Under the terms of the €1.275bn offer (£1.16bn at the time in September), Unilever will acquire a portfolio of more than 90 brands, across a number of different categories in 19 European countries. These include Radox, Brylcreem and Sanex.

In moving to Phase II of its analysis of the acquisition, the EC says it needs “more time” to determine the full implications of the deal from a competition perspective on particular European markets.

Unilever says it “welcomes the opportunity to engage more fully with the Commission’s competition authorities”. The process will balance the legitimate interest of the Commission with the company’s desire to maximise the opportunities from an acquisition that will deliver more value to consumers, customers and investors, says the company.

Unilever chairman Dave Lewis has said the addition of Sara Lee’s personal care business will allow the consumer goods company to reach different customer segments by enabling it to sell “value and mid-tier products” in the UK and Ireland.

However, some analysts have suggested the purchase isn’t in line with the company’s global strategy.

Speaking to Marketing Week on the back of the announcement in September, Colin Hession, managing director of specialist toiletry and cosmetics consultancy Colin Hession Consulting said: “Why would Unilever, having only recently got rid of its own long tail of small local brands, want to acquire a whole lot of someone else’s?

“Unilever has been talking about multi-country brands over the past five years, and now suddenly it buys Sara Lee’s ragbag of one-country and two-country brands – exactly of the sort they’ve been getting rid of,” he adds.

The deal is on track to be completed in the last quarter of 2010. The Sara Lee personal care and European laundry brands are maintaining “strong levels of growth” and Unilever continues to believe the deal will play a significant role in accelerating its growth in Western Europe.

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3703 or email customerservices@marketingweek.com

If you are looking for our Jobs site, please click here