Unilever Buys Family Trust Rights For GBP 715 Mln, Simplifies Share Structure

(RTTNews) - Anglo-Dutch consumer goods giant Unilever PLC (UL, ULVR.L, UN) said Monday that it has purchased the rights left in family trusts by its co-founder William Hesketh Lever for a consideration of 715 million pounds, or $1.20 billion. The company noted that the purchase of the rights will simplify its stock structure.

The rights are convertible in the year 2038 into 70.875 million Unilever PLC ordinary shares. The consideration is equivalent to 10.09 pounds per ordinary share, representing a 63 percent discount to Unilever's closing share price of 2,704 pence on Friday, May 16, 2014.

Unilever noted that as a result of the transaction, its core earnings per share will be boosted by 2 percent on a full-year basis as the share count used in the calculation is reduced by 70.875 million shares, or about 2.4 percent of the combined shares of dual-listed Unilever.

Jean-Marc Huët, CFO of Unilever, said, "It is another step in the simplification of Unilever's capital structure, making Unilever easier to understand, and eliminating ahead of time the burden of a significant dilution of shareholders' interests."

Unilever was founded in 1929 by the merger of the British soapmaker Lever Brothers that was founded in 1885 by William Hesketh Lever and his brother James Darcy Lever, and the Dutch margarine producer Margarine Unie. When William Lever died in May 1925, he left rights to a large number of Unilever plc shares in several trusts.

With more than 400 brands, Unilever's portfolio ranges from nutritionally balanced foods to soaps, shampoos and everyday household-care products.

UL closed Friday's trading on the NYSE at $45.52. In Monday's pre-market trades, the stock is up $0.32 or 0.70 percent to $45.84.

In London, Unilever shares are currently trading at 2,723 pence, up 19 pence or 0.70 percent on a volume of 1.67 million shares. In Amsterdam, the shares are gaining 0.69 percent to 32.22 euros.