Unilever has struck a £3.8 billion deal to sell off tea brands that it has owned for decades, including PG Tips and Lipton.
Sky News reports that its tea business, the biggest in the world, is being acquired by private equity firm CVC Partners.
The news comes almost two years after Unilever began a review of the division following sluggish sales.
It said that black tea had been declining in developed markets for years as younger people switched to coffee or herbal alternatives.
Ekaterra, as Unilever’s tea business is known, is based in Rotterdam and employs around 20,000 people worldwide.
It has 11 production factories in four continents and tea estates in three countries.
The Anglo-Dutch giant completed its acquisition of Lipton in 1972 and bought PG Tips in 1984.
Unilever chief executive Alan Jope was “proud of the place that our tea business has in our company’s history”, but said the sale was “an important part of our growth strategy”.
“Our decision to sell ekaterra demonstrates further progress in delivering against our plans,” he continued.
“We look forward to seeing ekaterra, with its strong brands and global footprint, prosper under CVC’s ownership.”
The deal is subject to regulatory approval and is expected to be finalised in the second half of 2022.
Unilever will keep its India and Indonesia tea operations, along with a bottled tea venture with PepsiCo.