Unilever looks to increase its stake in Indian subsidiary

(Source: Reuters)

Consumer products company Unilever has announced a voluntary open offer to increase its stake in its Indian subsidiary, Hindustan Unilever (release). The firm plans to increase its stake from 52.48 per cent to 75 per cent, requiring acquisition of over 487m shares. Unilever stated that Indian securities regulations required a minimum public shareholding of 25 per cent in order to maintain a public listing.

Pending regulatory approval, the offer is to begin in June. HSBC is the manager to the offer. Chief executive Paul Polman commented on the announcement:

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.