Associated Press
ROTTERDAM, Netherlands — Unilever yesterday said it reached a deal to sell the Bestfoods Baking Co. to George Weston Ltd. of Canada for $1.77 billion.
The Anglo-Dutch giant has been publicly negotiating the sale of the unit since October, seeking to focus on leading brands in other food categories as well as home and personal care products. Those brands include Lipton, Knorr, Slim-Fast and Hellmans.
Bestfoods' best-known brands are Entenmann's sweet baked goods, Thomas' English muffins, bagels and waffles and Oroweat, Brownberry and Arnold breads.
Weston is known for baking Girl Scout cookies.
"This is a very strong business that happens to fall outside of our foods strategy to focus on leading brands in core categories,'' said Patrick Cescau, Unilever's foods director.
The deal, which requires regulatory approval, should be completed in the first half of the year, according to a news release from Unilever.
Analysts had said deep-pocketed Sara Lee was favored to win the bidding. The Chicago-based company has acknowledged it is considering acquisitions after announcing plans to divest more than a dozen of its businesses.
Through its purchase, Weston will make a significant entry into the U.S. food market. Weston, which already operates 23 fresh bakery plants in the United States and Canada, also controls a major network of Canadian supermarket chains.
The Wall Street Journal Europe reported that the sale price was driven up by competitive bids from Sara Lee and Grupo Bimbo de Mexico. Analysts expected the company to fetch $1.6 billion.
The Bestfoods Baking Co. was acquired by Unilever when it bought the Bestfoods group last year.
About 12,000 people work at Bestfoods Baking Company's 19 plants across the United States, distributing products to more than 60,000 customers.
The company had sales of $1.8 billion in 2000 and earnings before interest and taxes of $141 million.
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