Ben & Jerry’s ice cream on May 24, 2022.
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Shares of consumer goods giant Unilever popped on Tuesday after the company announced plans to separate its ice cream unit, which includes Ben & Jerry’s and Magnum, as part of a restructuring that will impact 7,500 jobs.
“The proposed changes are expected to impact around 7,500 predominantly office-based roles globally, with total restructuring costs now anticipated to be around 1.2% of Group turnover for the next three years (up from the around 1% of Group turnover previously communicated),” a statement said.
Shares of Unilever were up 5.6% moments after the announcement, before paring gains slightly to trade up 4.1% at 9:20 a.m. London time.
The restructuring will begin immediately and is expected to be completed by the end of 2025, the company said. It is anticipated to deliver total cost savings of around 800 million euros ($868.3 million).
Unilever said the restructuring would allow it to become “a simpler, more focused company,” with four distinct business divisions across beauty and wellbeing, personal care, home care and nutrition.
The company added that its ice cream division, which generated 7.9 billion euros in revenue in 2023, would perform better as a standalone business. The ice cream division accounted for around 13% of Unilever’s 59.6 billion euros in total revenues in 2023.
Unilever said plans for the spinoff have not yet been finalized, but that a “demerger is the most likely separation route.”
It said that costs of the move would be determined once a final decision had been made.
The move is the most radical yet in a wider overhaul by CEO Hein Schumacher, who took the reins of the company in July 2023.
Unilever has faced growing calls over recent years, including from activist investors, to overhaul its sprawling business amid wide fluctuations in the share price. The stock has lost around 6% from a year ago.
Chris Beckett, head of equity research at Quilter Cheviot, questioned…
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