UK-based home products giant agrees to sell its Ekaterra tea business to Luxembourg-based CVC Capital Partners for €4.5bn ($5.1bn)
Ekaterra controls 34 prominent tea brands, including Lipton, PG tips, Pukka, T2 and TAZO | Photo credit: via Shutterstock
Unilever has agreed to offload its Ekaterra global tea business to private equity firm CVC Capital Partners for €4.5bn ($5.1bn).
Ekaterra controls 34 prominent tea brands, including Lipton, PG tips, Pukka, T2 and TAZO, generating revenues of around €2bn in 2020. The company promotes that it supplies 5% of the world’s tea supply, serving 385 million consumers daily.
The sale, which has taken more than two years to finalise, is expected to complete in the second half of 2022. Unilever will, however, retain control of its tea business in India, Nepal and Indonesia as well as its interests in the Pepsi Lipton ready-to-drink tea joint ventures and associated distribution businesses.
"The evolution of our portfolio into higher growth spaces is an important part of our growth strategy for Unilever. Our decision to sell ekaterra demonstrates further progress in delivering against our plans," said Unilever's CEO Alan Jope.
The sale reflects a changing hot beverage market, particularly in the UK, where traditional tea brands have lost ground to more premium rivals and growing at-home coffee consumption.
Commenting on the deal, Pev Hooper, a Managing Partner at CVC Capital Partners said: “Ekaterra is well positioned in an attractive market to accelerate its future growth, and to lead the category's sustainable development. We look forward to working with the team to realise Ekaterra's full potential."