Unilever has entered into an agreement to sell its global tea business ekaterra to CVC Capital Partners Fund VIII for in excess of $5 billion on a cash-free, debt-free basis. With 11 production factories on four continents and tea estates in three countries, ekaterra is the world’s leading, purpose-driven tea business, with a portfolio of 34 brands, including Lipton, PG tips, Pukka, T2 and Tazo, which generated revenues of approximately $2.25 billion in 2020.
The transaction 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.
Expected to be completed in the second half of next year, the transaction is subject to the completion of works council consultation processes and the receipt of certain regulatory approvals.
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Pev Hooper, a managing partner at CVC Capital Partners, says, “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 realize ekaterra’s full potential.”
Unilever CEO Alan Jope adds, “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.” Unilever is looking to focus on other areas, such as plant-based foods, nutrition, and premium beauty, to boost sales growth.