Billionaire Nelson Peltz Backs Unilever's Revitalization Plan Amid Investor Concerns: Report

Unilever Plc UL CEO Hein Schumacher reportedly expressed confidence in the company’s recently devised strategy, emphasizing the full support of billionaire activist and board member Nelson Peltz. 

Despite lingering investor skepticism after years of industry underperformance, Schumacher remains committed to revitalizing Unilever.

Schumacher outlined his vision for Unilever’s future, underscoring the need for a “systematic” marketing strategy for its flagship brands, which include household names like Dove, Hellmann’s, and Ben & Jerry’s. 

In an interview with Reuters, he asserted a commitment to streamlining the company’s extensive workforce of 127,000 employees, a move aimed at enhancing operational efficiency.

The multinational consumer goods giant’s CEO acknowledged his predecessor’s missteps, criticizing the previous expansion of Unilever’s brand portfolio to around 400, diverting attention from key performers. 

Addressing concerns raised by investors, Schumacher emphasized a strategic focus on the top 30 brands that contribute over 70% of the company’s sales, as per the report.

Peltz’s appointment to Unilever’s board in July 2022 was prompted by dissatisfaction with the company’s performance. 

Peltz also endorsed Unilever’s category-based business lines, contrasting with geographical structures adopted by competitors.

While some investors advocated spinning off Unilever’s food business, Schumacher emphasized executing the current growth action plan. 

The company recently initiated a €1.5 billion ($1.6 billion) share buyback, following increased volumes for the first time in 10 quarters.

Last week, Unilever reported an underlying sales growth of 7.0% in FY23, with a 6.8% price increase and a 0.2% rise in volume.

Despite initial disappointment voiced by investors regarding Unilever’s strategic plans, Schumacher is determined to address concerns and is open to the possibility of larger portfolio changes. 

As Unilever charts its course, the CEO remains focused on executing the growth action plan, acknowledging that history will ultimately judge his effectiveness.

In December, Unilever disclosed a binding offer to sell Elida Beauty Business to Yellow Wood Partners LLC.

Price Action: UL shares are down 0.47% at $50.37 during the premarket session on the last check Monday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.