Unilever on Monday rescued Chesebrough-Pond's from a hostile takeover attempt by American Brands and agreed to buy the consumer products company for $3.1 billion.
The definitive merger agreement calls for Unilever United States Inc. to pay $72.50 per share in cash for Chesebrough, well above the $66-per-share hostile tender offer launched Monday by American Brands, which amounted to about $2.8 billion.
The deal was announced after business hours, but Wall Street had suspected American Brands' bid would be insufficient to capture Chesebrough. In composite trading on the New York Stock Exchange on Monday, Chesebrough's stock closed at $68.50, up $3 from Friday.
Unilever, the Anglo-Dutch giant with 1985 sales of $21.6 billion, is one of the world's largest manufacturers of consumer branded products and packaged goods. It employs about 300,000 people and operates in 75 countries.
Chesebrough-Pond's consumer products include Vaseline personal care products, Ragu spaghetti sauces, Prince Matchabelli cosmetics and Bass shoes.
Unilever said it is considering selling "a significant part" of the chemical products group, something that American Brands had also intended to do.
Chesebrough granted Unilever various options that appeared to be intended to thwart any effort by another company to wreck the definitive merger agreement.
American Brands said it began a tender offer for the roughly 42.6 million outstanding common shares of Chesebrough-Pond's Inc. after efforts to negotiate a friendly deal failed.
American Brands said it had earlier offered to pay as much as $69 a share for the diversified consumer products company.