Anglo-Dutch consumer products group Unilever said today it agreed to sell the bulk of its frozen foods business to private equity group Permira Funds for €1.725 billion.
Kerry Group had been in the race to buy Unilever's Birds Eye and Igloo brands.
The Irish consortium had hoped to create a European frozen foods business worth more than €3 billion.
Analysts welcomed the selling price, which they said was at the high end of expectations, and urged the company to use proceeds to shore up its business or return cash to shareholders, rather than make any new acquisitions.
Unilever put the unit, which includes the Birds Eye and Igloo brands, up for sale in February. The deal includes Unilever's frozen foods operations in Austria, Belgium, France, Germany, Ireland, The Netherlands, Portugal and Britain.
The company said in a statement it would retain its frozen foods business in Italy, and the deal did not include operations in Spain, which were sold two months ago.
The company's Amsterdam-listed shares opened up 0.4 per cent at €18.45 on the news.