Unilever prepares to sell Flora and Stork

Unilever said it expects €3.5 billion of costs over 2017 to 2019 related to the efficiency measures

Unilever plans to sell its Spreads business.

In February, Kraft Heinz made a takeover offer for Unilever, hoping to create a packaged food and consumer goods giant.

Unilever has been under pressure to deliver more shareholder value following its rejection of a USD143.00 billion takeover bid by U.S. food giant Kraft Heinz in February.

Mr. Polman said Unilever's review of operations revealed that the company's strategy for growth is the right one, but also highlighted an opportunity "to go faster and further".

The Anglo-Dutch consumer group has set itself a new operating-margin target of 20% by 2020.

The report also announced that Unilever would be buying back €5bn worth of shares over the remainder of 2017, and that expected sales growth for 2017 remains at 3 - 5% - despite "continued challenging market conditions".

Following the failure of the audacious takeover attempt, the maker of Dove soap and Marmite launched a strategic review to boost returns for shareholders.

Pitkethly told Reuters that much of the margin improvement would come from the food business, which it now plans to combine with the refreshment business, which includes Ben & Jerry's ice cream and Lipton tea. "Unilever realised it needed to do more for shareholders, but it also has to improve margins", said analyst Neil Wilson, at EXT Capital.

As part of the cost-cutting measures, Unilever increased its overall cost savings target from four billion euro (£3.4 billion) to six billion euro (£5.1 billion), to take place over the next three years.

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It is listed in both London and on the Amsterdam AEX, where its share price today were up 0.75 per cent at €46.92 a share.

Pitkethly said merger and acquisition activity should pick up as the company increases its appetite for leverage, but said the strategy regarding big deals was unchanged.

Unilever has decided the future of the Spreads business lies outside the group.

As part of its corporate review, announced this morning, Unilever will also look at that "dual-headed structure" - and whether it needs to have two separate legal entities registered in the Netherlands and the UK.

"To fund it, Unilever is borrowing - increasing its net debt from about x1 earnings before nasties to x2 EBITDA". The company's last share buyback was in 2007.

In evaluating alternatives for its spreads business, Unilever said on Thursday that it became apparent that the dual structure "adds complexity when undertaking such changes".

He said the margarine business was a "declining segment" that could be "better managed by others".

"For 2017, we remain on track to deliver underlying sales growth ahead of our markets".

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