KKR Halts $10 Billion Sale of Upfield, Maker of Flora and Country Crock Spreads

KKR halts $10B sale of Upfield, the maker of Flora and Country Crock, amid price disagreements, now exploring IPO or minority stake sale as dealmaking environment remains fragile.

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Rafia Tasleem
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KKR Halts $10 Billion Sale of Upfield, Maker of Flora and Country Crock Spreads

KKR Halts $10 Billion Sale of Upfield, Maker of Flora and Country Crock Spreads

KKR & Co., a prominent private equity firm, has halted the $10 billion sale process for Upfield, the producer of popular spreads like Flora and Country Crock. The decision came after negotiations on a sale to Abu Dhabi sovereign wealth fund ADQ fell apart due to price disagreements. Upfield drew only muted interest from other private equity bidders.

With limited options, KKR is now exploring alternative strategies for Upfield. These include the possibility of holding onto the business for a longer period or potentially pursuing an initial public offering (IPO) or the sale of a minority stake. If KKR decides to move forward with an IPO, it would likely take place in 2025 at the earliest, giving the firm more time to deleverage the business.

Why this matters: The halted sale of Upfield reflects the increasingly fragile market for dealmaking, characterized by high interest rates and a gap in valuation expectations between buyers and sellers. This challenging environment is making it difficult for private equity firms to execute large transactions smoothly.

Upfield was previously a unit of Unilever Plc, which sold the business to KKR for €6.8 billion in 2018 under pressure from investors to accelerate growth and increase profitability. Since the acquisition, KKR has undertaken a lengthy overhaul of Upfield's operations, including acquiring plant-based cheese business Violife.

The decision to pause the sale suggests KKR is reconsidering its options for Upfield, a significant business within its portfolio. This strategic pivot reflects KKR's adaptability in seeking optimal outcomes for its investment in the global leader in plant-based spreads and margarines.

Key Takeaways

  • KKR halted the $10 billion sale process for Upfield due to price disagreements.
  • KKR is now exploring alternatives like holding the business or pursuing an IPO.
  • The halted sale reflects a fragile dealmaking market with high interest rates.
  • Upfield was previously a Unilever unit sold to KKR for €6.8 billion in 2018.
  • KKR is reconsidering its options for Upfield, a significant business in its portfolio.