Reckitt Benckiser food sale 'targets strategic buyers' - Just Food
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Reckitt Benckiser food sale ‘targets strategic buyers’

01 Jun 2017

Reckitt Benckiser is apparently targeting strategic buyers as it kicks off the sale of its food business.

Reckitt Benckiser food sale ‘targets strategic buyers’

Reckitt Benckiser is apparently targeting strategic buyers as it kicks off the sale of its food business.

According to news agency Reuters, which cited an unnamed source, information packages have been sent out to industry players as the group prepares to shop the business. What is believed to be strong interest from strategics prompted Reckitt Benckiser and its advisor, Morgan Stanley, to exclude private-equity firms at this stage in the process. Typically, strategic buyers may be able to offer higher valuation multiples because they are able to leverage future sales and cost synergies.

The business up for sale includes brands such as French’s mustard and Frank’s RedHot sauce. Potential interested parties are said to include Unilever, US spices and sauces group McCormick & Co., and four other US-based companies – Conagra Brands, Hormel Foods, Pinnacle Foods and Campbell Soup Co.

The disposal of the unit is expected to raise around US$3bn. Cash will be used by Reckitt Benckiser to reduce debt after its $16.6bn acquisition of Mead Johnson, which was approved by the US infant formula group’s shareholders yesterday (31 May).

just-food was unable to reach representatives for UK-based Reckitt Benckiser for further comment at time of press.