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Unilever to cut 20,000 positions

August 03, 2007|From Reuters

Unilever, the world's third-biggest food and consumer goods company, unveiled plans Thursday to cut 20,000 jobs and sell slow-growing businesses to speed up its recovery and fight surging food costs.

Shares in the Anglo-Dutch group, which has 400-plus brands including Dove soap, Knorr soups and Sunsilk shampoo, jumped as much as 8.4% on hopes it was finally coming to grips with reversing years of underperformance.

Unilever said the restructuring would affect about a tenth of its 180,000 employees. The cuts would be mainly in Europe and be implemented over four years.

Unilever also posted a 5.8% rise in second-quarter underlying sales, beating analysts' forecasts of 4.2% to 5.5%, and said it expected full-year sales growth at the upper end of its 3% to 5% target band.

"There is now real evidence of sustained improvement in the group," Panmure Gordon analyst Graham Jones wrote in a research note.

Unilever said it would close or streamline about 50 of its 300 manufacturing sites, reduce its regional centers from about 100 to about 25 and shed 11% of its workforce.

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