Unilever, the consumer goods behemoth behind iconic brands like Marmite and Dove soap, has unveiled plans for significant restructuring, including job cuts and the separation of its ice cream division.
The move comes as part of a comprehensive three-year cost-saving strategy.
The multinational corporation intends to slash approximately 7,500 jobs worldwide, constituting over 5 percent of its global workforce of 128,000 employees. This restructuring initiative aims to generate savings of around €800 million (£684 million) by 2025.
Furthermore, Unilever disclosed its intention to divest its ice cream business, encompassing beloved brands such as Wall’s, Ben & Jerry’s, and Magnum. This decision marks a strategic shift for the company, as it seeks to streamline operations and focus on core business areas.
Unilever’s chairman, Ian Meakins, emphasised the rationale behind the restructuring, stating, “The separation of ice cream and the delivery of the productivity programme will help create a simpler, more focused, and higher performing Unilever.” He expressed confidence that this move would pave the way for a “world-leading ice cream business” with promising growth prospects.
A spin-off
The ice cream division, with brands including Viennetta, Carte d’Or, Cornetto, and Breyers, achieved global sales of €7.9 billion (£6.75 billion) last year. However, Unilever cited the seasonal nature of the ice cream business and its distinct supply chain requirements as reasons for the spin-off.
Shares in Unilever surged by 5 percent following the announcement, indicating investor confidence in the restructuring plan. Matt Britzman, an analyst at Hargreaves Lansdown, noted that the decision to divest the ice cream unit was not unexpected, given its underperformance in recent times.
While Unilever hinted at a possible demerger of the ice cream business, wherein existing shareholders would receive shares in a newly listed entity, the company did not rule out other options such as a direct sale. Britzman suggested that a demerger seemed likely, as no potential buyer has been identified thus far.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
