After a disappointing 2023 for ice cream sales, Unilever is set to separate from Ben & Jerry’s and establish it as a separate business. The British consumer products company highlighted that ice cream businesses have a very different operating model.
Hein Schumacher, Unilever CEO told the media, that the future growth of the company and ice cream is best served by separating the business. He said Unilever will most likely list the new ice cream company on the stock market by the end of 2025.
Unilever said spinning off Ben & Jerry’s and its other ice cream brands, including Cornetto, Magnum, and Kwality Wall’s, will allow the company to focus on boosting revenue in its other divisions. “Ice cream has distinct characteristics compared with Unilever’s other operating businesses. These include a supply chain and point of sale that support frozen goods, a different channel landscape, more seasonality, and greater capital intensity.”
However, plans for the spinoff have not been finalized. Unilever said demerger is the most likely separation route. Terry Smith, managing director of Unilever’s 10th largest shareholder Fundsmith, said the restructuring was positive news. He described Ben & Jerry’s as the ‘fly in the ointment’ of the ice cream business. “Prior management seem to have managed to buy a company without actually getting control of it.” Smith believes ice cream is a troubled category for Unilever. “I can see why they might do that. It’s not had any volume growth for quite a while, particularly in the at-home consumption area.”
If Unilever goes ahead with the spinoff, the new business will feature five of the 10 best-selling ice cream brands worldwide.
Also Read: Mars Wants to Make a Name in Ice Cream Business, Keen On Brand Expansions For Growth
