Unilever PLC Initiates Offer to Increase Stake in Hindustan Unilever
1 May 2013 --- Unilever PLC has announced a voluntary open offer to increase its stake in Hindustan Unilever (HUL), its publicly listed subsidiary in India, from 52.48% to up to 75% at a price of INR 600 per share.
Paul Polman, CEO Unilever, said: “This represents a further step in Unilever’s strategy to invest in emerging markets and offers a liquidity opportunity at what we believe to be an attractive premium for existing shareholders. The long heritage and great brands of Hindustan Unilever, and the significant growth potential of a country with 1.3 billion people makes India a strategic long term priority for the business.”
The offer, which is made pursuant to the rules of the Securities and Exchange Board of India, is to acquire up to 487,004,772 shares, representing 22.52% of the total outstanding shares of HUL, which would increase Unilever’s stake to up to 75%. Securities regulations in India require a minimum public shareholding of 25% for a company to maintain a public listing in the country.
The offer, payable in cash, represents a premium of approximately 29.5% over the mandatory floor price required under Indian regulations, a premium of 26.0% to HUL’s last one month’s average trading share price and 25.0% to the last one week’s average trading price on the National Stock Exchange of India Limited. The potential total value of the transaction at the offer price (assuming full acceptances) is approximately INR 292.2 billion or €4.1 billion.
Subject to regulatory clearance, the offer period is expected to begin in June 2013. Payment for the shares will take place shortly after close of the offer. HUL’s shares are traded on the BSE Ltd (Scrip Code: 500696) and on the National Stock Exchange of India Limited (Symbol: HINDUNILVR).
The details of the offer can be found in the public announcement which will shortly be available at www.sebi.gov.in, www.bseindia.com, and www.nseindia.com and the detailed public statement and letter of offer which will be filed in connection with the offer with the relevant stock exchanges and the Securities and Exchange Board of India.
The Offer is being managed by HSBC Securities and Capital Markets (India) Private Limited.
Hindustan Unilever is a market leader in the fast moving consumer goods business in India, with brands spanning categories such as soaps, detergents, shampoos, skin care, toothpastes, deodorants, cosmetics, tea, coffee, packaged foods, ice cream, and water purifiers. Its portfolio includes the following brands: Lux, Lifebuoy, Surf Excel, Rin, Wheel, Fair & Lovely, Pond’s, Vaseline, Lakmé, Dove, Clinic Plus, Sunsilk, Pepsodent, Closeup, Axe, Brooke Bond, Bru, Knorr, Kissan, Kwality Wall’s and Pureit.
Hindustan Unilever generated over INR 270 billion turnover (or €3.8 billion) and net profit of over INR 38 billion (or €0.5 billion) for the financial year ending 31 March 2013.
Unilever will continue to consolidate 100% of the results and net assets of HUL, but the net profits attributable to non-controlling interests and the share of equity of the non-controlling interests will both be lower after the transaction.
