LONDON - Unilever will sell its tea division to investor CVC Capital Partners in a deal worth 4.5 billion euros. The tea branch, known by the nam Ekaterra, is the largest tea company in the world, according to Unilever. It includes 34 brands, including well-known names such as Lipton, Pukka and Tazo. The annual turnover of Ekaterra amounted to approximately 2 billion euros in 2020.

The Indian, Nepalese and Indonesian tea activities are not included in the terms of the sale. Partnerships that Unilever has in the ready-to-drink tea beverage space were also excluded from the deal.

Among the world's biggest companies in food and cleaning products, Unilever has been looking at the future of the tea branch since the middle of last year. In recent years, consumers have started to drink tea less frequently, replacing it with other items, like artisanal coffee. As a result, the turnover growth of the tea brands is too low, according to Unilever CEO Alan Jope. He wants Unilever to focus more on parts of the company projected to grow faster, such as cosmetics and skin care products.

The tea division generated a great deal of attention. In addition to CVC, investor Advent International was also reportedly in the race to acquire Ekaterra for quite some time. Several other investors such as Carlyle, Clayton Dubilier & Rice and KKR are also said to have expressed interest. 

Ekaterra has eleven factories on four continents. In addition, the company has its own tea plantations in three countries.

Unilever expects the sale to be completed in the second half of next year. Before that time, various regulators and stakeholders still have to give their approval.