Unilever could join £4bn Wella bidding war

Unilever, the Anglo-Dutch group behind products from Calvin Klein fragrances to Magnum ice cream, is considering entering a £4bn bidding war for Wella, the German hair care and cosmetics company.

Unilever is mulling whether to wade into the fray once Procter & Gamble, the US consumer goods giant, declares its hand. Speculation that the family-controlled Wella was up for sale resurfaced last week after Henkel, a German consumer products group, snapped up a stake of almost 7 per cent.

Henkel's move follows reports that P&G, which makes Pantene shampoo and owns the Clairol hair colour range, opened talks with Wella earlier this month. P&G is said to have offered the Stroher family £4bn to sell up.

A Unilever spokesman declined to comment yesterday. But the group, which is emerging from a five-year restructuring drive, has been focusing on its higher margin home and personal care arm. It is pressing ahead with the relaunch in Europe of its Sunsilk hair-care range, as well as extending Dove, another priority brand, in the US. Acquiring Wella's range of shampoos and perfumes would help Unilever achieve its target of lifting its operating profit margin to 16 per cent by 2004, the end of its "Path to Growth" programme.

Any deal with Wella could be complicated by the competing interests of the four different family branches who control 78 per cent of the group's voting rights. All are descended from Franz Stroher, the hairdresser who founded the group in 1880.

The successful bidder would have to offer a hefty premium to defeat Henkel, which under German takeover rules now holds a blocking stake.