Unilever has entered an agreement with South Africa-based investment group Remgro to sell its spreads business, valued at ZAR7bn ($527.95m).

Remgro, which is part-owned by Johann Rupert, chairman of the luxury goods group Richemont, will in exchange sell its stake of 25.75% in Unilever South Africa Holdings (Unilever SA).

The deal also includes a cash consideration of ZAR4.9bn ($369m), representing a total transaction value of ZAR11.9bn ($897m).

Remgro CEO Jannie Durand said: “Through this transaction, Remgro has exchanged its minority stake in Unilever South Africa for full ownership and control of the Unilever Spreads business in South Africa, Botswana, Lesotho, Namibia, and Swaziland plus cash.

“We believe the Unilever Spreads business in these Southern Africa countries is an attractive business, with leading brands which include Rama, Stork, Flora, and Rondo with good growth prospects.”

"Remgro has exchanged its minority stake in Unilever South Africa for full ownership and control of the Unilever Spreads business in South Africa."

The sale of the spread business, which reported around €3bn in annual sales last year, is expected to allow the company to help offset continued declines in developed markets.

The closing of the deal is subject to the customary regulatory approvals.

Unilever SA executive vice-president Luc-Olivier Marquet said: “Unilever South Africa is a great business, well positioned for sustainable long-term growth.

“By giving us full ownership of the business, this transaction means we are better placed to accelerate that growth while the spreads business moves on to Remgro wher it augments their current portfolio and can be sure of a great future.”

Remgro invests in a wide range of industries, including food, beverage, insurance and healthcare, as well as other sectors.