Unilever lifts deadline on Bestfoods bid

Lucy Baker
Friday 16 August 2013 04:26

Unilever, the Persil to Flora group, yesterday lifted the deadline on its $18.4bn (£11.8bn) bid for Bestfoods as the US maker of Hellmann's mayonnaise was accused by shareholders of acting improperly in turning down the Unilever cash offer.

Unilever had given the Bestfoods board until the close of US business yesterday to respond to its bid but scrapped the ultimatum about six hours ahead of time, saying that it wanted to negotiate an agreed deal.

A spokesman for Unilever said: "The deadline has been lifted but the proposal is still on the table. We are still seeking a meeting with Bestfoods' board and we are patiently awaiting their response."

He confirmed that the Anglo-Dutch company had put in place $20bn of funds to back its $66-a-share offer "so if things move forward we are in a position to act".

The spokesman refused to comment on reports that Joan Cohen, a Bestfoods shareholder, had filed one of a handful of lawsuits in Delaware Chancery Court, Wilmington, alleging that the US group's directors acted out of self-interest in rejecting Unilever's approach as "inadequate" on Tuesday.

Ms Cohen alleges that "the rejection of Unilever's offer [will] ensure their continued positions in the company."

She also says the rejection will deprive Bestfoods' shareholders of the premium that Unilever is prepared to pay, or the enhanced premium that negotiation with Unilever or other potential bidders could provide.

In her lawsuit, Ms Cohen asks a judge to order Bestfoods' directors to seriously consider the sale of the company, and seeks damages and legal fees.

Gale Griffin, Bestfoods' official spokeswoman, said: "As we stated on Tuesday, we believe the proposal from Unilever is inadequate and not in the best interest of our shareholders. These kinds of lawsuits are totally to be expected ... We will defend them vigorously."

Ms Griffin said the company had received support from many shareholders, including institutions, for the rejection of the $66-a-share offer. She would not comment on the company's likely response if Unilever raised its bid.

Asked whether the group would be prepared to negotiate a price, she said: "I can't comment on possible outcomes ... They have made no new proposal. What we have to deal with is the proposal on the table."

Unilever shares closed up 16.5p at 365.25p.

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