Unilever gets £155m for Elizabeth Arden

Unilever, the consumer products giant, has sold its Elizabeth Arden fragrance and skincare business for $225m (£155m) to an American perfume company as part of its drive to shrink the group to its top 400 brands.

Unilever, the consumer products giant, has sold its Elizabeth Arden fragrance and skincare business for $225m (£155m) to an American perfume company as part of its drive to shrink the group to its top 400 brands.

FFI Fragrances, based in Miami, will buy the business, which includes the right to license Elizabeth Taylor's White Diamonds perfume, in the cash and shares deal.

The move follows a decision by Unilever to shed underperforming parts of the group. It had earmarked Elizabeth Arden, which it has owned since 1989, and its European Bakery Supplies Business for disposal. Elizabeth Arden generated operating profits of $18m in 1999, on sales of $550m.

Unilever, which has just bought America's Bestfoods, must also sell its Oxo and Batchelor's brands to secure European Union approval.

Under the terms of yesterday's deal, Unilever will retain Elizabeth Arden's designer fragrances - Cerruti, Lagerfeld, Chloe and Valentino - to expand its new Unilever Cosmetics International business, which includes Calvin Klein Cosmetics and Nautica.

Some analysts questioned whether Unilever had clinched a good deal. "Prices of about $300m were mentioned last month and that did not include the entire range of Elizabeth Arden lines," one said. Unilever shares fell 6.75p to 466.25.

Unilever said the sale will contribute an after-tax loss of $790m in its fourth quarter results next February. This is due to accountancy changes, which mean the company has to write back goodwill of $830m from the sale of Elizabeth Arden. The group is due to report strong third quarter results on Friday.