London, May 7 - Food and consumer goods giant Unilever Plc/NV is looking at a sale and licence deal for its Bertolli Italian olive oil and balsamic vinegar business, sources close to the situation said on Wednesday.
The business has annual sales of around 300 million euros ($465 million) and Unilever could expect to get up to 200 million euros for it as part of the group's on-going restructuring programme, the sources added.
But the Anglo-Dutch group is keen to keep hold of the Bertolli brand after the success of its sauces, spreads and snacks, and so is looking to sell the olive oil refining side but licence back the brand for its own use.
"Unilever wants to exit the commodity side of this business but maintain a hold on the higher margin sauces and spreads area," said one source.
Unilever is currently conducting a review of the business which includes its Inveruno oil olive site near Milan, but has not ruled out holding onto the business if it does not fetch a good price, the sources said.
"We are exploring some strategic partnership opportunities for Bertolli olive oil and vinegar," said a Unilever spokesman.
Bertolli, which claims to be the world's leading olive oil brand, dates back to 1865 when Francesco Bertolli and his wife Caterina began selling olive oil from a small shop underneath their family home in the Tuscan town of Lucca.
Now owned by Unilever, the food giant has looked to tap into the popularity of Mediterranean cuisine by expanding the Bertolli Italian brand to a range of spreads, pasta sauces, snacks and meals, but sees the largely commodity based oil refining side as holding back the group's overall growth.
Last August, Unilever said it wanted to sell off slow-growing businesses with more than 2 billion euros of annual turnover, including its North American laundry unit, which accounts for 800 million euros of annual sales.
So far Unilever has sold its French cheese Boursin and has agreed to sell its U.S. marinades & spices business Lawry's, and both these businesses have around 100 million euros each of annual sales.
On Thursday, Unilever will announce its first-quarter results and although a Reuter Poll points towards healthy underlying sales growth of 5.7 percent in the first three months of 2008 this would still lag behind rivals Nestle on 9.8 percent and Danone at 11.4 percent. ($1=.6456 Euro)