Processed cheese giant Kraft Heinz has made a $143bn (£115bn) merger offer for FTSE 100-listed UK food producer Unilever, it announced today.
In a statement Kraft said Unilever had declined an initial offer to combine the two groups, but added they were still in talks.
Under the offer, Unilever shareholders would receive $50 per share, in a mix of $30.23 cash and 0.222 share in the new company.
The offer represents an 18 per cent premium to Unilever's shares - but that wasn't enough for the company's board, which said it "sees no merit, either financial or strategic, for Unilever's shareholders".
Confusingly, it added it "does not see the basis for any further discussions".
However, Kraft disagrees. It said combining the two companies, which will encompass brands from Dove soap to Philadelphia cheese to Heinz baked beans, will "create a leading consumer goods company with a mission of long-term growth and sustainable living".
In a statement it said:
While Unilever has declined the proposal, we look forward to working to reach agreement on the terms of a transaction. There can be no certainty that any further formal proposal will be made to the board of Unilever or that an offer will be made at all or as to the terms of any transaction.
UK-listed shares in Unilever shot up almost 15 per cent to 3,845p on the news, while shares in Kraft Heinz rose 4.3 per cent to $87.28 in pre-market trading in New York.
#Marmitegate and other stories
Last year the suggestion Unilever might be forced to hike prices by as much as 10 per cent because of the falling pound led to #Marmitegate and an outpouring of rage from consumers.
In January the company revealed subdued sales, with underlying revenue growth of 2.2 per cent, compared with analyst expectations of 2.8 per cent.
But Kraft is in a similar position – yesterday it posted a 3.7 per cent sales drop in the fourth quarter, although profits increased more than 200 per cent to $285m.