Unilever is close to selling under-performing snacking brand Graze to Germany’s Katjes at a discount price as the consumer goods giant pushes forward with its plans to divest non-core food assets.
Talks with Katjes, which owns Candy Kittens and Genius Foods in the UK, are at an advanced stage, with a value of about £35m, according to reports by Sky News, which broke the news earlier today.
It is much lower than the £50m-£80m estimates floated by bankers earlier this year when news of the sale emerged, and a significant drop compared with the £150m paid by Unilever for Graze in 2019.
The deal comes as Unilever reportedly kicked off a process last week to explore options for British heritage brands Marmite, Bovril and Colman’s. A sell-off in food is part of a 2023 action plan launched by former boss Hein Schumacher, who earmarked assets worth around €1bn of group revenues as disposable.
New CEO Fernando Fernandez is accelerating the strategy to focus more on the group’s higher-margin personal care and beauty divisions, striking deals this year to buy rapidly growing brands such as Wild and Dr Squatch.
Graze has fared poorly under Unilever, which saw off competition from Kellogg’s and PepsiCo to buy the brand in 2019 as part of a growing focus to increase exposure to the burgeoning DTC market.
The business launched in 2008 as a snack box delivery service before expanding into retail channels and pushing into the North American market.
But it has failed to make a profit since the Unilever deal, with operating losses almost doubling in 2024 as the parent group integrated the snacking brand into its wider UK foods operation.
Revenues at Graze, which stood at £55m before Unilever took control, fell 9.9% year on year to £35.6m in 2024.
The brand ceased operating in DTC last year to simplify its supply chain and focus solely on UK retail.
Katjes has had a presence in the UK since buying a minority stake in confectionery brand Candy Kittens in 2018, before taking ownership in 2019.
Its investment arm, Katjes Greenfood, acquired gluten-free bakery Genius Foods in 2022.
Unilever declined to comment. The Grocer has asked Katjes for a response.
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