Unilever Sells Bertolli Olive-Oil Business To Grupo SOS

Unilever Sells Bertolli Olive-Oil Business To Grupo SOS

Grupo SOS to Buys Bertolli Olive-Oil Business from Unilver To Expand in U.S.

Spanish food company Grupo SOS SA agreed to buy Unilever's Bertolli olive-oil and vinegar business for €630 million ($998 million) in a move to strengthen its position as the world's leading olive-oil bottler.

Grupo SOS, which owns brands such as Italy's Carapelli and Spain's Carbonell, already controls about 15% of the world's olive-oil output. The acquisition of Bertolli, the world's biggest olive-oil brand, will bring its market share to 20%.

The Spanish company has a market value of €1.76 billion and last year reported sales of €1.41 billion. The Bertolli acquisition, which will add €380 million in annual sales, is part of Grupo SOS's drive to secure a larger share of the coveted U.S. food market amid rising demand for healthier products.

"This transaction is absolutely strategic to Grupo SOS and it reinforces us as world-wide leaders in olive oil," said Chairman Jesus Salazar. "We share our focus on the Mediterranean diet with Unilever, and benefits will accrue to both our groups and to the consumer."

Consumption of olive oil has grown world-wide after being linked to health benefits such as longer life and lower cholesterol. Oil bottlers have also launched premium brands in recent years on rising global demand for international gourmet products.

Anglo-Dutch consumer-products company Unilever said it will keep using the Bertolli brand for other foods, including margarine, pasta sauces and frozen meals. The Bertolli brand had global revenue of about €700 million in 2007, Unilever spokesman Gerbert van Genderen Stort said.

Unilever, which makes Skippy peanut butter, Ben & Jerry's ice cream and Dove soap, will book a profit of €450 million on the olive-oil and vinegar divestment, Mr. van Genderen Stort said. Unilever said in May that it might sell the Bertolli oil and vinegar business, but that it was considering keeping the Bertolli brand for other foods. The sale is part of a continuing divestment plan that includes businesses with combined annual sales of €2 billion.

Like other food companies, Unilever has been hit by rising commodity prices of corn, edible oils and milk. At the same time, it has been re-evaluating its brand portfolio, cutting jobs and costs as well as shedding units as it focuses on innovative and higher-priced products to boost profit.

UBS AG advised Grupo SOS and NM Rothschild & Sons Ltd. advised Unilever on the deal.