Reckitt Benckiser looking into different option for its food business
According to latest reports, Reckitt Benckiser has said in a statement that it is set to start a strategic review of its food business, that could even be sold.
The company said it was taking into account “all options” for the unit, which comprises French’s mustard and sauce products.
Reports said that the firm is planning a sale to help fund its acquisition of US baby food maker, Mead Johnson, for $16.6 billion. Consumer goods giant products include Cillit Bang cleaning goods and painkiller Nurofen.
Meanwhile the company reportedly said French’s Food was a “truly fantastic business with great brands”, but was non-core.
“We have therefore decided to initiate a strategic review of food where we will explore all options.”
In the last 12 months period Reckitt’s stock have surged 9 % and was up 11p to £72.97 in morning trading.
Furthermore in the food division, which in 2016 had sales worth more than £400 million, could reach about £2.4 billion.
Reckitt also revealed to slash the salary of chief executive Rakesh Kapoor to £14.6 million from approximately £26 million in 2015.
Some shareholders had recently suggested that Mr Kapoor had pursued the Mead Johnson tie-up to make sure he hit well-paid bonus targets.
Moreover Mr. Kapoor said the deal was along the lines of company strategy and would help make £200 million of cost savings after three years, even though it would not spawn a return for about five years.