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UPDATE 1-Delhaize halts Unilever products in pricing row

Published 02/10/2009, 10:07 AM
Updated 02/10/2009, 10:08 AM
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(Updates with Delhaize comments)

BRUSSELS, Feb 10 (Reuters) - Belgian supermarket group Delhaize has halted orders for 300 Unilever products from its stores in Belgium after price negotiations with the consumer goods giant ended in deadlock.

"We did not reach an agreement during our annual negotiations. The price of goods is a part of that agreement," Unilever spokeswoman Liesbeth Rogiers said on Tuesday.

She added that Delhaize had already stopped orders for 70 of the group's products in October 2008. Unilever normally supplies Delhaize with 480 different products.

Delhaize said in a statement that Unilever's move was "unprecedented" and added that its relations with Unilever were currently "tense."

The Belgian company also said the Unilever dispute would have a knock-on effect on Delhaize's customers.

Unilever hopes to come to an agreement with Delhaize in talks later this year so that its products can once again be delivered to stores, Rogiers said.

"(This) clearly illustrates that retailers like Delhaize are using their bargaining power to negotiate the best possible prices from suppliers," Bank Degroof analyst Ivan Lathouders said in a note to clients. (Reporting by Antonia van de Velde, editing by Will Waterman and Rupert Winchester)

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