Unilever in major shake up

Unilever is shifting its focus to its key brands

Anglo-Dutch consumer goods giant Unilever is splitting its business into two global divisions and is planning a major shake-up in management.

The news comes as the maker of Liptons tea, Dove soap and Flora magarine reported a 9% fall in pre-tax profits to £1.24bn in the first half of the year, from £1.36bn in the corresponding period last year.

The fall in profits is due to costs related to the company's major restructuring programme, which it announced in February.

Turnover rose 3% to £13.78bn in the first half of 2000, up from £13.35bn in the same period last year.

Two global divisions

The company plans to set up two global divisions, one for food and home goods and the other for personal care products.

The move comes as part of the company's restructuring plan, which aims to focus on Unilever's top brands to boost its sales.

The group plans to shed most of its 1,200 portfolio brands to a core 400 key brands.

"We are focusing on our leading brands, addressing the underperforming business as demonstrated through the forthcoming sales of our European bakery business and our restructuring programme is on target," said Unilever chairman Niall FitzGerald.

Analysts said the move could spark speculation that Unilever might demerge into two different companies and noted there were concerns about the costs of carrying out the split.

The decision to two new groups have brought about major management changes at Unilever.

New managers

As of January 2001, finance director Patrick Cescau will replace as global chief Alexander Kemner, who is retiring.

Keki Dadiseth, who undertook the company's six-month management review, will take over Clive Butler as the head of global home and personal care products. Mr Butler becomes corporate development director.

In its strategy to concentrate on growth brands, the company has gone on a major spending spree, espeically in the US, where it has bought a bundle of well-known brands.

The acquisitions include Ben & Jerry's ice cream, Slim-Fast and Bestfoods, whose brands include Hellmann's mayonnaise.