The Unilever Tea Board of Directors has approved the proposal to have a separate entity to manage its tea business. This follows a decision by its parent firm Unilever Group to separate its global tea business including tea plantations.
Subject to any regulatory approvals, Unilever’s Kenyan tea business will be transferred to a foreign newly incorporated tea company Unilever Tea Holdco UK Limited (TeaCo). The company says the idea is to create a dedicated tea group within the Group.
In a notice to shareholders of the Limuru Tea estate, Unilever Kenya Board said the assets being transferred to TeaCo include Unilever Tea Kenya.
After the transfer of shares, UTKL’s indirect interest in Limuru Tea will also transfer to TeaCo. Unilever Kenya owns a 52% stake in the Nairobi listed Limuru Tea.
Unilever Tea, a subsidiary of Unilever and an Anglo-Dutch conglomerate, is involved in the production of tea, mainly for export.
UTKL started as Brooke Bond Kenya (BBK). The name was changed to Unilever Tea Kenya Limited (UTKL) in 2004. UTKL currently has a total landholding standing at 16,223 acres, has 20 tea estates and eight factories manufacturing an average of 32 million kgs of tea per year.
In January 2009 Unilever Tea was delisted from the Nairobi Stock exchange (NSE) after Brooke Bond took its holding in the company to 97.65%. The drive for the Anglo-Dutch firm to de-list from the NSE emanated from the fact that it does not meet the requirement that all listed firms should have at least a 25% equity stake owned by local shareholders.
The multinational has a worldwide network and achieves close to half of its turnover in developing and emerging markets in Asia, Africa, Central and Eastern Europe and Latin America.