Unilever deal gets go-ahead

 
City A.M. Reporter
ANGLO-DUTCH consumer goods firm Unilever won EU regulatory approval yesterday for its $1.3bn (£817m) purchase of Sara Lee Corp’s bodycare business after pledging to divest some assets from the acquisition.

The European Commission said Unilever’s plan to sell Sara Lee’s Sanex brand and related business in Europe had eased concerns that the takeover could hurt competitors and lead to higher prices for consumers.

“As Unilever offered a strong and clear-cut remedy to address the competition concerns in a number of deodorant markets, the Commission was able to clear the merger,” EU Competition commissioner Joaquin Almunia said in a statement.

The regulator had been concerned about possible anti-competitive effects in Belgium, the Netherlands, Denmark, Britain, Ireland, Spain and Portugal. Sara Lee’s Sanex deodorants compete with Unilever’s Axe, Dove and Rexona brands.

The Sara Lee brands acquired by Unilever had annual sales of more than €750m, with earnings before interest, tax, depreciation and amortisation of €128m, for the year ended in June 2009.

Sara Lee interim chief executive Marcel Smits said in a statement that the deal would have no effect on plans to repurchase between $2.5bn and $3bn of shares by the end of fiscal 2012. The company said there had been significant interest in the rest of its household business and that it was still looking into options to sell off the unit, which includes shoe care and Asian cleaning brands.