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There’s none better placed than the Board to appreciate the GSK consumer acquisition. I’d be happy for them to continue conditional upon some future divestment of Unilever’s more mundane brands. Longer term, consumer health has better growth prospects than processed foods so people should avoid short term thinking on this, imho.
There is no such thing as easy money in the stock market,
it's risk v reward and on assessing risk it's impossible to
factor everything in - you can term a stock idea high
conviction, that perhaps is more accurate.
"SP down over 20% in last 12 months is overdone imo."
Definitely overdone, which is why I've been topping up. Easy money, just like it was with BP and RDSB.
https://sg.finance.yahoo.com/news/unilever-could-lose-credit-rating-181829628.html
The management has to make a statement before it goes out of hand. I hope the investors will vote him out
Barchid,
I agree that PE must be looking at Unilever. And the more the SP drops the more likely a bid will come in. The break up value of Unilever is about 50-55% higher than the current market cap. For a quality company that’s unusual and for every 1% the share price drops the breakup value increases the potential profit by 2%. I’m expecting the BoD to declare themselves out of the running for GSK and for a quick share price recovery and while we wait there’s a 4.1% divi and a real chance of a takeover.
I expect a decent set of results 10 February and GSK to IPO...
SP down over 20% in last 12 months is overdone imo.
Analyst consensus earnings per share up more than 5% YoY and 5% revenue growth.
https://www.unilever.com/investors/results-presentations/analysts-consensus/
NervousNelly you said
'I may be wrong, but I understand that Jope gets paid in tanker loads of vaseline rather than cash.'
The reality is that ULVR shareholders will need said product if the BOD continues down this destructive path.
'Emma Walmsley has reportedly set up sovereign wealth fund meetings'
'Unilever investors sceptical about a takeover of GSK's consumer arm'
https://www.msn.com/en-gb/money/other/glaxo-courts-qatar-and-singapore-to-head-off-%C2%A350bn-unilever-swoop/ar-AASSdPN
I think the deal is dead.
Emma Walmsley has reportedly set up sovereign wealth fund meetings with Singapore and Qatar next month to help underwrite any future deals and to take major stakes. I read it today on a financial thread whilst in a meeting
stewart81
I agree.
Remember how much Morrisons finally went out at ?
ULVR must have every large VC company globally running their assets through their calculations. We are not talking 2nd or 3rd rate assets here, we are talking top global quality in many cases, and much of it is in food which never goes out of fashion.
The BoD have discredited themselves and major shareholders (Train/Smithfor instance) must be praying for a bid.
Jope has turned Unilever into a corporate kamikaze hell bent on self-destruction. The negatives for this insane deal are staking by the day. I just find it staggering that Jope was even allowed to make a bid.
“Ratings agency Fitch said that Unilever's bid for GlaxoSmithKline's consumer health assets would put the consumer goods group's 'A' credit rating at risk because of the huge debt it would have to swallow.
Unilever's 50 billion pound ($67.88 billion) initial bid for
GSK's consumer health arm, which owns brands including Panadol painkillers and Sensodyne toothpaste, was rejected by the pharmaceuticals company. ...
"Unilever's offer... is likely to raise Unilever's debt to an extent that it would not be able to reduce to levels consistent with an 'A' rating category over 2024-2025, opening the possibility of a multi-notch downgrade into the BBB category," Fitch said in a report.”
My reasoning for buying is I think it’s a certainty shareholders will vote against it. So for me it’s a calculated risk and although there’s more potential downside while the BOD remain silent, I only bought half the amount of shares I wanted to with the option to buy the other half lower if it gets there. It’s also widely believed that the break up value of Unilever is £52+ a share and at these depressed prices there’s always a chance of a bid. As I’ve said l, for me it’s a calculated risk on the basis this bid won’t happen and there’s no reason to believe it will. Time will tell.
Why would people consider buying these even if there is a slight chance of shareholders being asked to bank role this ludicrous GSK buy?
BOD - Too old, been here long enough, too highly paid & poor decision makers.
If this was an American company the SP would be £60.00
3569 on T212. Surely this price and over a 4% divi is cheap?
A 4 percent isn’t any good if Unilever have a £12 billion cash raise from shareholders to finance this insane takeover. (as is widely publicized)
That’s like you giving me a thousand pound and me giving you £40 back.
Paul
“I made a modest top up today of 87 shares at £35.86 (Inc tax etc.)“
Pity you didn’t have the good sense to wait till the end of the week. You could have bought for £32.
The market’s made it clear what it thinks of Jope’s deal to pay £60 billion for a bit of toothpaste and a few painkillers. It would be one of the most catastrophic takeovers in corporate history- any fool can see that.
Except for the moron leading the company.
The consequences of taking over GSK’s healthcare for double its value doesn’t bear thinking about.
I can only surmise Pfizer and GSK clocked they were dealing with an utter moron when they declined his eye watering £50 billion offer. Obviously they thought he was good for more.
Not a single broker has a positive word to say about this deal. Hopefully institutional investors will get together and show Jope the door. All he’s succeeded doing by making this crazed takeover public is shown himself to be totally inadequate to run a lemonade stand. And if he does get his way he will oversee Unilever’s ruin.
Freddy Goodwin’s ABN takeover jumps to mind.
And he was a megalomaniac psychopath.
In my opinion Jope is just a prize sucker.
Getting uglier by the minute! live price is 3516 :(
Starting to think selling up the lot early yesterday would have been wise
For me the GSK bid is utter madness. It’s also rumoured that GSK are going to load the consumer arm with £10 billion of debt! The prospect of Unilever paying £60 billion plus the £10 billion of debt for a company that’ll grow at 3% a year is frightening! Of all the cheap companies in the UK that are ripe for a takeover Jope seems hellbent on pursuing GSK. Off the top of my head Tate and Lyle would be a good bet with faster growth. I’ve just opened half of my desired position size at 3550 and if it drops to 3400 I’ll open my other half as I don’t think the GSK takeover has a chance of happening. After shareholders don’t approve if they should be looking to oust Jope and have a boardroom shake up as they have clearly lost any little faith investors had in them this week. £10 billion wiped off the value of the company which means if there’s a share element to the offer then it will be even more expensive with the drop in Unilever’s share price.
Reportedly never made a profit despite the money Unilever
has poured in, value now? - likely a minus.
£1bn gone - just like that as the late great Tommy Cooper
used to say.
Paul, if every acquisition had been as successful
as Ben & Jerry's the SP would be close to £100 a share.
And both founders are Jewish and still involved in the business.
The CEO joined Unilever in 1985, the CFO in 2002, CDMO in 1990, CSCO in 1991, and the COO in 1987 - they are tired to adapt to changes. Consumer Healthcare is not the future for Unilever and probably the idea of Sunny Jain, appointed in March 2019 to be president of Beauty & Personal Care, he arrived from Amazon!
Ben & Jerrys looked like a good move, but what happened was unpredictable, and these things happen from time to time.
Its a popular brand and as always the recent unpleasantness will no doubt blow over.
For me I think the divis will be be under threat in the medium term if they go ahead. The statement to reduce any incurred leverage in the medium term speaks volumes.. On the plus side hopefully they will ditch that PC outfit - ben and jerrys, Caused more damage to the ULVR brand than anything.
I bought ULVR because I believe it will be a long term hold in my portfolio. I still believe that although it will never make huge capital gains, and there are better dividends, it is a relatively safe long term hold.
I would expect the management team to know which of their products offers the least return on investment, and if they plan on dropping those products in favor of more profitable products I see that as a good thing.
I think the aquisition of the part of GSK in question could indeed be a good fit. It just depends if the cost is worth the reward, and I'm far from quallified to judge that as I doubt very much I have access to all the facts.
For me its ok if I don't always understand a BODs decisions, but if I didn't have a little faith in a BOD I would probably close my position on the stock. I appreciate others views will differ, but at the moment this stock is looking reasonably cheap.
I made a modest top up today of 87 shares at £35.86 (Inc tax etc.)
Does not help much as my average is still £41.187.
I do also hold GSK so not all bad news.