0 valutazioniIl 0% ha trovato utile questo documento (0 voti)
236 visualizzazioni4 pagine
Unilever acquired American company Alberto Culver in 2010 to expand into the personal care industry and gain access to Culver's strong brands and presence in the US and Latin American markets. However, the $3.7 billion acquisition faced regulatory hurdles due to concerns it would give Unilever too much market share in hair products. The US Department of Justice sued to block the deal and Unilever had to agree to divest some brands. Additionally, Culver employees were hesitant to work with Unilever until the acquisition was finalized, posing integration challenges. While Unilever hoped to expand its personal care business globally through the deal, it highlights the various regulatory and stakeholder barriers companies face during foreign
Unilever acquired American company Alberto Culver in 2010 to expand into the personal care industry and gain access to Culver's strong brands and presence in the US and Latin American markets. However, the $3.7 billion acquisition faced regulatory hurdles due to concerns it would give Unilever too much market share in hair products. The US Department of Justice sued to block the deal and Unilever had to agree to divest some brands. Additionally, Culver employees were hesitant to work with Unilever until the acquisition was finalized, posing integration challenges. While Unilever hoped to expand its personal care business globally through the deal, it highlights the various regulatory and stakeholder barriers companies face during foreign
Unilever acquired American company Alberto Culver in 2010 to expand into the personal care industry and gain access to Culver's strong brands and presence in the US and Latin American markets. However, the $3.7 billion acquisition faced regulatory hurdles due to concerns it would give Unilever too much market share in hair products. The US Department of Justice sued to block the deal and Unilever had to agree to divest some brands. Additionally, Culver employees were hesitant to work with Unilever until the acquisition was finalized, posing integration challenges. While Unilever hoped to expand its personal care business globally through the deal, it highlights the various regulatory and stakeholder barriers companies face during foreign
The Archetypal Model: Unilever and a Major Global Acquisition
Kyron Richard
University of Southern California FOREIGN DIRECT INVESTMENT CASE STUDY 2 The Archetypal Model: Unilever and a Major Global Acquisition
Though the Anglo-Dutch conglomerate, Unilever, it is most recognized for its significant market share of the food and consumer industry, it had a stake in the personal care industry before 2010 with market leaders like Dove and Suave. However, it made attempts to it expand into this, more profitable, industry through the acquisition of an American company Alberto Culver. Culver had strong standing in the United States, and promising for other emerging markets in Latin America, which holds high hopes for Unilever, (Sonne & Byron, 2010). Martin Deboo, an analyst with Investec Securities, highlighted a major impact the Culver acquisition could have on Unilevers business, Personal care brands are easier to globalize than food brands because consumers tend to have the same needs in common. But food is quite different, in that culinary tastes differ from region to region (Bawden, 2010). This information is particularly important for a company that sells products in 170 countries, and the profitability possibilities are virtually endless. Unfortunately for executives at Unilever, some of their stakeholders were not excited about the opportunity, or found it too lucrative. The four central stakeholders in this case include governmental regulation entities, Alberto Culvers employees, Alberto Culvers shareholders and Unilevers own shareholders. The former is important because governments take extreme caution to conglomerates which have what they deem to be too significant market shares in certain industreis, which endangers fair pricing. Culvers employees and shareholders not only determine the value of the company but also how productive it is. If the react negatively it could endanger the acquisition, or have an impact on the final group, Unilevers shareholders who may FOREIGN DIRECT INVESTMENT CASE STUDY 3 not approve of the deal or might feel threatened at a negative reaction from Culvers staff and investors. Government officials recognized the possibility for Unilever to have a significant monopoly on the hair product market, and the Antitrust Division of the Department of Justice filed a lawsuit in May 2011, seven months after the companies had agreed to a selling price of around 3.7 billion. According to the Department of Justice, the sale would have a negative impact for, In the case of value shampoo and conditioner it would reduce the number of significant competitors in the value shampoo and conditioner markets from three to two, leaving Unilever with approximately 90 percent of those markets (Justice, 2011). This loss of competition is of great importance to governmental regulators who want to maintain a competitive market landscape and ensure fair pricing for consumers. Though there were initial complications with the acquisition, the parties soon reached a compromise and, Under the terms of the agreement with the US DOJ, Unilever will divest the Alberto VO5 brand in the United States from the Alberto Culver portfolio and the Rave brand from its own portfolio (Financial, 2011). There was still another hurdle to be jumped over. One other important stakeholder that Unilever failed to receive support from was the employees of Alberto Culver. A statement was made by Dan Stone, the Vice President of corporate communications for Alberto Culver who said in 2010, his team is not working closely with Unilever, since the company is still a competitor until the [deal closes] (Bruell, 2010). This attitude is important for Unliever, since integration of the brands is important to the acquisition. The Unilever case is an archetypal model for the various barriers to investment for companies. FOREIGN DIRECT INVESTMENT CASE STUDY 4 Works Cited Bawden, T. (2010, Sep 28). Unilever spends pounds 2.3bn to acquire US toiletries firm: Alberto culver deal brings high-margin hair products anglo-dutch firm will aim to cut costs by $160m. The Guardian. Retrieved from http://search.proquest.com/docview/755253594? accountid=14749
Bruell, A. (2010, 11). Alberto culver comms not yet under unilever. PRweek, 13, 7. Retrieved from http://search.proquest.com/docview/864730294?accountid=14749
Financial markets; unilever receives approval to acquire alberto culver. (2011). Economics & Business Week, , 151. Retrieved from http://search.proquest.com/docview/867394979? accountid=14749
Justice department requires divestitures in unilever's acquisition of alberto-culver company. (2011, May 06). Targeted News Service. Retrieved from http://search.proquest.com/ docview/865065839?accountid=14749
Sonne, P., & Byron, A. (2010, Sept 28). Unilever primps for the hair aisle: Proposed alberto culver acquisition would set up challenge to p&g, l'oral. The Wall Street Journal. Retrieved from http://online.wsj.com/news/articles/ SB10001424052748704654004575517162530733910