Lipton, a British brand of tea is named after its founder Thomas J. Lipton. Lipton is one of the largest tea brands being available in more than 110 countries worldwide. Lipton teas are made by selecting blends from different plantations around the world from countries like Sri Lanka, India, Kenya, and China. Though Lipton also introduced soups, they are not much popular. Let’s learn about ‘Lipton Owner’.
Lipton is currently owned by Ekaterra. Ekaterra owns about 34 world-class brands, including Lipton, Brooke Bond, and PG Tips. Ekaterra was obtained by CVC Capital Partners from Unilever for 4.5 billion euros in November 2021. The transaction was completed in July 2022. The headquarters of Ekaterra is situated in Rotterdam, The Netherlands. It constitutes about 11 production sites and about 16,000 people working on four different continents. It is the biggest tea business globally. Eka is Sanskrit and means ‘one’; whereas terra is Latin and it means ‘land’. Let’s read more about lipton owner.
History of Lipton Tea:
In the late 1800s, tea had become a popular drink among the British but still, it remained a luxury to most people. The increased tea price was actually due to the middlemen playing a large part in it. Lipton thought that if he eliminated the middlemen in the process of buying and selling, he could able to sell the tea at a lesser price. Not only he could sell it at a lower price but also could obtain a decent profit. So in the process, he bought some tea estates in Sri Lanka and started growing tea. He also installed machinery that could handle huge production. Thus he was able to cut down the cost of tea. He did not stop with that. In Lipton’s shop, he saw that the shop assistants measured tea and folded it into papers. Lipton had the brilliant idea of making tea bags to facilitate transportation and standardization. Soon, the Lipton tea bags grew in numbers and were popularised worldwide.
What was the cost reduction when the middlemen were eliminated?
According to Lipton, the selling price came down from 50 cents to 30 cents per tea.
Lipton Under Unilever:
In 1971, Lipton was brought under the control of Unilever. Through this Unilever became the largest supplier of instant tea in the world. The consumption of tea gradually declined from the 1970s to the 1980s due to the popularity of coffee. In 1991, Unilever and PepsiCo created a partnership, expanding the coverage of Lipton instant teas. This made a positive hike in the selling of Lipton teas. After that in 2019, Unilever occupied the first place in the global tea market with 143 billion portions per year, which equates to 270000 cups every single minute. The amount that Unilever made is not just any number. It is some serious business. Though even Lipton had some staggering start under Unilever, the brand continued growing.
Which company was responsible for the sudden popularity of coffee?
Starbucks was responsible for the sudden popularity of coffee.
Why Unilever Decided to Sell Lipton?:
The tea bag market in the US did not show any growth in 2019. In the case of Lipton, it showed a reduction of 5.2% in revenue and 1.1% in market share. However, Lipton’s biggest competitor Bigelow saw an increase of 0.7% in market share. The consumers’ attitudes towards traditional teas were changing. The consumers in turn wanted fruity alternatives to be taken on the go. Even though the Statista reports showed that the tea market was expected to grow, Unilever thought that household brands like Lipton cannot compete with the others. Eventually, they decided to secede with Lipton.
What are the other top tea brands in the market?
The other top brands are Celestial Seasonings and Twinings of London.
Lipton’s Current Owner:
Unilever sold its complete tea business “Ekaterra” to CVC Capital Partners in November 2021 for 4.5 billion euros. The complete deal keeps out Unilever’s tea business in India, Indonesia, and Nepal. This deal also excludes Unilever’s Pepsi Lipton joint ventures in ready-to-drink teas. Some famous brands of Ekaterra are Lipton, Brooke Bond, PG Tips, T2, Pukka, and TAZO.
CVC Capital Partners:
Citicorp Venture Capital, abbreviated as CVC was founded in 1981. CVC Capital Partners is a private equity firm located in Luxembourg. The services provided by them are investment banking and brokerage diversified financial services. It has about 133 billion US $ of assets under its superintendence. It has over 700 employees employed across 25 offices around the world. The other notable investments apart from Unilever’s tea business are Avast (IT Security Company), RAC (service provider), Petco Holdings (pet supplies retail chain), and Gujarat Titans (IPL team).
Now We’ve learnt about ‘Lipton Owner’, Though Lipton’s ownership changed over the years, Lipton could continually secure a place in the global tea market due to its marketing and advertising strategies. The success of Lipton products made it set up an institute named The Lipton Institute of Tea. It is a research facility that conducts studies on the physical and mental benefits of tea. Thus being an established brand, Lipton is still making sales and profits in the global tea market.
Frequently Asked Questions:
- Who are Ekkaterra’s competitors?
Ans: Possible competitors to Ekaterra may include Ottera, Bottled Baking, and Cezy.
- Who were the previous owners of Lipton?
Ans: Unilever, PepsiCo, and Agryll Foods.