Global Consumer Goods group, Unilever, announced that it has entered into an agreement to sell its global Tea business, ekaterra, to CVC Capital Partners Fund VIII for €4.5 billion ($5.08 billion) on a cash-free, debt-free basis. CVC Capital beat rival private equity firms Advent and Carlyle to the deal.
ekaterra is the world’s leading Tea business, with a portfolio of 34 brands including Lipton, PG tips, Pukka, T2 and TAZO. It owns 11 production facilities across four continents, and tea estates in three different countries and the business generated revenues of around €2 billion in 2020.
However the sale to CVC Capital excludes Unilever’s Tea business in India, Nepal and Indonesia as well as Unilever’s interests in the Pepsi Lipton ready-to-drink Tea joint ventures and associated distribution businesses.
According to Alan Jope, CEO of Unilever, “The evolution of our portfolio into higher growth spaces is an important part of our growth strategy for Unilever. Our decision to sell ekaterra demonstrates further progress in delivering against our plans.
“We are proud of the place that our Tea business has in our company’s history. We look forward to seeing ekaterra, with its strong brands and global footprint, prosper under CVC’s ownership. I would like to thank our Tea colleagues around the world for their passion and commitment to our Tea business and wish them well for the future.”
Pev Hooper, a Managing Partner at CVC Capital Partners said: “ekaterra is a great business, built on strong foundations of leading brands and a purpose-driven approach to its products, people and communities. ekaterra is well positioned in an attractive market to accelerate its future growth, and to lead the category’s sustainable development. We look forward to working with the team to realise ekaterra’s full potential.”
John Davison, CEO of ekaterra, said: “ekaterra is a strong business with positive momentum and has an exciting future ahead under the new ownership of CVC. We look forward to the next stage of our journey as the world’s leading Tea business.”
The transaction is expected to be completed in the second half of 2022
