Unilever Drops Takeover Bid for Richardson
Unilever on Wednesday officially ended its effort to take over Richardson-Vicks, expressing disappointment but saying that Procter & Gamble’s offer of $69 a share, or $1.2 billion, is too high a price.
Unilever, the giant Anglo-Dutch company that managed to accumulate only 100,000 shares--barely half a percent--of Richardson-Vicks’ stock during a monthlong attempt at a hostile takeover, also said it has ended a lawsuit against Richardson-Vicks’ defenses.
In a statement, Unilever said it was “disappointed in not being able to consummate a transaction. . . . However, the price obtained exceeded the value of the business to Unilever.” Unilever spokesman Humphrey Sullivan said Wednesday that his company “congratulated the Richardson-Vicks board on obtaining such a full price for all its shareholders.”
Meanwhile, rumors circulated for a second day on Wall Street that Unilever now is focusing its attention on Beatrice Cos., the Chicago-based diversified food processor.
Although Beatrice is $2.5 billion in debt as a result of its 1984 acquisition of Esmark, analysts say the company might be a target because food companies in general are all the rage. Neither Unilever nor Beatrice would comment on the rumors.
Beatrice’s stock was the third most active on the New York Stock Exchange on Wednesday, closing up 37.5 cents at $39.25 on turnover of nearly 2.7 million shares.
Tuesday, Beatrice announced that it was putting its Avis rental car business and three smaller units up for sale because they “either don’t fit our long-term focus on food and consumers products or will not meet our financial performance requirements.” The proceeds will be used to reduce the company’s debt.
Unilever is seeking a U.S.-owned company through which it could distribute its food, skin and health-care products, said John Bierbusse, an analyst with Duff & Phelps in Chicago. An acquisition of Beatrice, which has 109 million shares outstanding, would cost at least $4.25 billion at current market prices.
In its court action against Richardson-Vicks, Unilever had accused the company of violating federal securities laws by issuing a misleading news release when it rejected Unilever’s first offer. It also sought to overturn one of the company’s defenses--the issuance of a new preferred stock that gave extra votes to long-term holders of Richardson-Vicks’ stock.
A federal judge ruled in Unilever’s favor on the stock issue, however, and Richardson-Vicks announced the merger with Procter & Gamble four days later.
