The proceeds will wipe out Unilever's pounds 1.7bn of debts and leave Mr FitzGerald with a huge war chest as he seeks to redefine Unilever as a more focused fast-moving consumer goods company similar to rivals Nestle, Procter & Gamble and Campbell's.
Mr FitzGerald, who took over as chairman in September, said the decision was part of a plan to "de-clutter" the Unilever portfolio and concentrate on key brands, which include Persil detergents, Flora margarine and ice-creams such as the Magnum and Solero.
Though the chemicals division is highly profitable, Mr FitzGerald said that 16 per cent of the business was "underperforming" and that disposals in the foods division would follow.
Unilever's shares put on 78.5p to pounds 14.71p as City analysts welcomed the shake-up. Shares in Reckitt & Colman and Cadbury Schweppes also rose as industry experts said a deal in Europe or North America was most likely.
As analysts pondered a possible re-rating of Unilever's shares, they said the bold move represented a re-invention of a company which in the past has been criticised for being cumbersome and bureaucratic.
"What we are looking at is a fundamental re-evaluation of Unilever's business," one analyst said. "They are not selling the crown jewels, they are saying `Let's define ourselves not by our history but by what we are good at'."
Announcing the sell-off plan, Mr FitzGerald said: "This intention is a clear demonstration of our commitment to focus our attention on the fast-moving consumer product and service category and related businesses in which we excel and in which we are determined to lead the world."
He said the decision to exit speciality chemicals had not been easy. "It's a strategic decision to do with where we want to be in the future. We either had to double the size of the [speciality chemicals] business or get out."
Mr FitzGerald said a trade sale was more likely than a flotation. Though he did not rule out returning cash to shareholders he expressed more interest in developing Unilever's interests in emerging markets such as China, South-east Asia, south Latin America and eastern Europe where Unilever is enjoying rapid growth.
The businesses up for sale have combined turnover of pounds 3bn and staff of 15,800 in 35 countries. Last year they recorded combined profits of pounds 415m. The highest price tags are likely to be attached to the National Starch and Chemical Company, which produces industrial adhesives, resins and speciality starches, and Quest International, a leading fragrances company with interests in food flavour and ingredients.
Analysts said the sale of these two "collectors' items" was likely to spark an auction. Possible buyers for National Starch include Henckel, du Pont and Associated British Foods. Companies such as IFF and Roche would be interested in Quest. Also up for sale is Unichema International, an oil and fats business that makes ingredients for soaps, skincare products and shampoos, and Crosfield, a producer of inorganic chemicals for use in the petroleum and plastics industries.
The shake-up came as Mr FitzGerald announced a 15 per cent rise in pre- tax profits to pounds 2.6bn for the year to the end of 1996. The figures were dented by pounds 325m of exceptional items, of which pounds 100m related to the integration of the Helene Curtis hair-care division and the Diversey industrial cleaning products business.
Group sales were up 6 per cent at pounds 33.5bn. The final dividend was 32.05p.Reuse content