Unilever bids farewell to ice cream division

On March 19th, Unilever announced a significant shift in its corporate structure. This change involves the separation of its ice cream division and the introduction of an extensive productivity program. These moves are part of Unilever's 'Growth Action Plan' (GAP), aimed at sharpening the company's focus and fostering sustainable growth.

The Unilever Board of Directors has decided to split off the ice cream division. This decision is influenced by the division's unique business characteristics, such as a dedicated supply chain and sales channels for frozen products. These distinct features require a different business model compared to Unilever's other operations. By separating, the company aims to enable both the ice cream division and Unilever to concentrate on their specific growth potentials.

In 2023, the ice cream division, which includes leading brands like Wall's, Magnum, and Ben & Jerry's, achieved a turnover of €7.9 billion. This move allows the division to evolve and invest in its unique strategy and operations as an independent entity. The full separation is expected to be completed by the end of 2025, considering various options to maximize shareholder interests.

Introduction of the productivity program

Alongside the corporate restructuring, Unilever is implementing a comprehensive productivity program. This initiative aims to create a leaner and more efficient organization, supported by technological investments. Unilever anticipates saving around €800 million over the next three years with this program, more than offsetting the operational dis-synergies from the ice cream division's separation. Additionally, the program will reduce complexity within the company, focusing on process standardization and technology-driven efficiency improvements.

These changes are expected to impact approximately 7,500 predominantly office-based roles worldwide. Unilever underscores the importance of consultation with employees and representatives throughout this process and commits to handling the impacts on staff with respect and care.

Future vision and impact

The separation and the productivity program will allow Unilever to focus on its strongest and most scalable brands. This strategy is expected to lead to sustainable growth and improved profitability. Ian Meakins, Chairman of Unilever, emphasizes that these steps will transform the company into a more focused and higher-performing enterprise.

CEO Hein Schumacher adds that these changes will enable Unilever to apply its innovation and market approach more effectively. This underscores Unilever's commitment to delivering strong, sustainable growth and improved profitability while carefully considering the involved employees.

Unilever.nl