Unilever Puts Cash to Use to Expand EM Presence

Today's acquisition news from Unilever supports our view that certain companies are wisely taking advantage of emerging market opportunities

Erin Lash, CFA 14 October, 2011 | 4:47PM
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Unilever (ULVR) today announced its intentions to acquire 82% of Kalina, a leading Russian beauty-care firm, for about EUR 495 million. The deal implies a forward price/sales multiple of 2.0 times and an enterprise value/EBITDA of 11.7 times, which seems reasonable to us. We're not making any changes to our fair value estimate for Unilever based on this announcement, as the acquired business will represent less than 1% of the global consumer product firm's consolidated sales. However, this deal supports our sentiment that our wide- and narrow-moat companies with substantial cash piles are taking advantage

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Unilever PLC3,964.50 GBX-0.64Rating

About Author

Erin Lash, CFA  Erin Lash, CFA, is a senior stock analyst with Morningstar.

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