Banga new HLL chief, Dadiseth to join Unilever board

According to reports coming from London, Dadiseth has been asked to undertake a review of Unilever’s top organisation and submit a report in the next three months. Unilever also announced two other nominations for directorship. Like Dadiseth, Andre Van Heemstra has been nominated as director – personnel and member of the executive committee. Charles Strauss will be a director responsible for Unilever’s North American business.

Born two years prior to Indian independence, Dadiseth’s first assignment will be to undertake a review of Unilever’s top organisation and report during the third quarter of 2000. Dadiseth joined Hindustan Lever in 1973, and undertook a number of roles before being seconded to Unilever in 1984 where he held senior financial and commercial positions. Returning to India, in 1987 he became vice-president, personnel and two years later took on the additional responsibility for HLL’s personal products business.

In 1991, he was appointed executive director and head of detergents. He was made vice-chairman ad managing director of HLL in 1995, and became chairman in August 1996. During Dadiseth’s tenure, HLL went through some turbulence in which for the first time, the Securities and Exchange Board of India had accused the company and its directors of insider-trading. The Sebi has filed prosecution charges in Mumbai High Court against five HLL directors, including the outgoing Chairman. The case is still being heard.

UNILEVER TO CUT 25,000 JOBS: Unilever said on Tuesday that it will eliminate 25,000 jobs, or 10 per cent of its workforce, over the next five years as part of a massive restructuring aimed at reinvigorating a sluggish top line. The Anglo-Dutch giant also reported lower 1999 pre-tax profits and flat sales, in line with industry analysts’ estimates tempered by similarly lacklustre recent results.

In a bold attempt to shake off perceptions of inaction in the face of difficulty, Unilever set ambitious new targets to increase revenue growth to five per cent and operating margins to 15 per cent by 2004, versus 11.1 per cent in 1999. Future promotional and development efforts will zero in on 400 key brands out of the company’s stable of roughly 1,600, Chairman Niall Fitzgerald said.

"The consequence of that is that the tail brands will fall away in due course and that we will be able to simplify and make major improvements to the supply chain and to the way in which we do business generally," Fitzgerald said.

Among the key brands to be emphasised will be well-known names such as Lipton tea, Dove soap and Calvin Klein fragrances. The company will invest — one billion in additional marketing support for the key brands over five years, he said. "The remaining businesses that do not meet performance standards or which are no longer part of our strategy will be reorganised or divested," he said.

Topping the list of under-performing units targeted for turnaround were the Elizabeth Arden cosmetics division and the European baking business. Both will be restructured this year. "If the baking business does not improve performance significantly, "it will be divested by the year-end," he said.

As part of the restructuring, Unilever will make "radical changes" to its supply chain to focus on 150 key sites. "There will be probably be about 100 sites surplus to requirements, which we will dispose of," Fitzgerald said.

Annualised savings from restructuring were projected to be — one billion by 2004. The programme’s cost was estimated at — 3.3 billion, with most of the expected job losses coming in Europe and the Americas. Further specifics were unavailable. Unilever’s hard-nosed approach pleased markets, which drove up its stock price in morning trading. The shares were ahead 4.7 percent in London and 6.2 percent in Amsterdam, as investment bank Warburg Dillon Read raised its recommendation on the stock to "strong buy" from "hold".

DADISETH’S INNINGS AS HLL CHAIRMAN