As part of its strategy to improve investor rewards and justify its rejection of Kraft Heinz's approach, Unilever will also splash out 5 billion euros ($5.3 billion) in a share buyback and will raise its dividend 12 percent this year.

Unilever, one of Europe's biggest blue-chip stocks, called the Kraft episode a "trigger moment" to assess its business, as the global packaged goods industry faces slowing growth and greater competition.

In the weeks since the review was announced, some analysts had speculated that Unilever would split into two companies in a dramatic reversal of its strategy, but executives said this was not on the cards and repeated the rationale that there are benefits from having both businesses.

"We are confident our model of long-term compounding growth is working," Chief Executive Paul Polman said.

MARGIN IMPROVEMENT

The group said it would speed up a cost-savings plan, targeting a 20 percent underlying operating margin, before restructuring, by 2020, up from 15.3 percent in 2016.

Chief Financial Officer Graeme Pitkethly told Reuters that much of the margin improvement would come from the food business, which it now plans to combine with the refreshment business, which includes Ben & Jerry's ice cream and Lipton tea.

Unilever also said it would take on more debt, at least in part to finance acquisitions, targeting net debt of 2 times core earnings or EBITDA. Its leverage ratio has been below 1 time for more than half of the past 20 years, Jefferies analysts have said.

It would launch a share buyback this year of 5 billion euros having not had a buyback programme in place since 2008.

Pitkethly said merger and acquisition activity should pick up as the company increases its appetite for leverage, but said the strategy regarding big deals was unchanged.

He said Unilever would consider combining its dual-headed structure - in Britain and the Netherlands - into one, but said the choice of which might stand would not be impacted by Brexit.

Regarding the shrinking margarine and spreads business, which is one of its founding businesses, Pitkethly said it was already seeing a lot of interest, particularly from financial players such as private equity firms.

Unilever's London-listed shares, which had risen to a record 4,088 pence in recent weeks ahead of the announcement, were flat at 3,933p by 0812 GMT.