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Advent, GIC team up in $5.6B bid to bag UK tea brands

·1 min read

Advent International has joined with Singapore's sovereign wealth fund GIC in a £4 billion bid (about $5.6 billion) to buy PG Tips, Lipton and other tea brands from Unilever, Sky News reported. 
 
The unit is said to have previously attracted interest from several PE suitors, including Cinven and the Abu Dhabi Investment Authority, as well as The Carlyle Group, Clayton Dubilier & Rice and KKR.

Anglo-Dutch consumer goods giant Unilever started exploring the sale of the business—which does not include Unilever's tea operations in India and Indonesia or its ready-to-drink tea partnerships—in early 2020. The group previously said that tea sales have fallen, mostly due to a decline in demand for black tea in developed markets.

If a deal goes ahead, it won't be the first time Unilever has sold to PE. In 2017, KKR picked up Unilever's margarine and spreads division for around $8 billion. Prior to that, in 2006, it sold its Iglo frozen foods business to LGT and Permira for about $2.2 billion. 

It will not be the first time private equity has invested in tea either. In July, London-based firm Zetland Capital picked up struggling UK tea brand Typhoo in a bid to help the business reassert its presence in a saturated market.

GIC, which has previously been a limited partner in at least four Advent funds, has a history of teaming up with the Boston-headquartered firm. Earlier this month, the pair made a joint offer to buy Swedish Orphan Biovitrum in a deal valuing the Stockholm-listed pharmaceuticals company at 69.4 billion Swedish kronor (around $8.1 billion).

Featured image by virusowy/Getty Images