Unilever brews shortlist for £4bn sale of PG Tips and Lipton Ice Tea

28 September 2021, 17:52 | Updated: 28 September 2021, 19:34

Unilever has brewed a shortlist of bidders for its PG Tips and Lipton Ice Tea brands as it brings the £4bn auction to the boil.

Sky News has learnt that CVC Capital Partners has made it through to the second round of one of the year's biggest consumer goods sale processes, and will vie with three of its biggest rivals to buy the division.

City sources said that CVC was bidding against bids from Carlyle; a joint offer from Advent International; and a consortium comprising Cinven and the Abu Dhabi Investment Authority.

Rivals including Bain Capital and Clayton Dubilier & Rice are said to have dropped out of the process.

Alan Jope, the Unilever chief executive, is seeking to sell or spin off its tea unit, which also includes famous brands such as Lipton Ice Tea, because of sluggish sales growth in the category globally.

Mr Jope began a strategic review of the division in January last year, with a sale unlikely to be completed until 2022.

The auction does not include Unilever's tea operations in India or Indonesia, or its assets in the ready-to-drink tea segment.

It is the latest major food and beverage business to be earmarked for sale by Unilever, which sold its spreads business - comprising products such as Flora - to KKR for more than £5bn in 2017.

Mr Jope has been focusing Unilever's financial muscle on acquiring brands in faster-growing consumer product categories such as skincare, where it acquired Paula's Choice, a digitally led brand, earlier this year.

CVC and Unilever declined to comment.