HUL’s ‘evaluating options’ for ice cream business, after Unilever announces plans to separate the business: LiveMint

Hindustan Unilever announced on March 19 that it is currently “evaluating various options" for its ice cream business in India, subsequent to the decision made by its parent company Unilever to separate its €7.9 billion ice cream division by the conclusion of 2025, according to a LiveMint report.

“The ice cream business has an inherently different business model, including a cold-chain go-to-market operating model, seasonality, and a different innovation rhythm compared to the rest of Unilever's business. As far as the Indian ice cream business is concerned, we are evaluating the various options in light of this announcement," an HUL spokesperson said in response to Mint’s queries.  

In FY23, Hindustan Unilever recorded total revenue from operations amounting to Rs 59,144 crore, with the ice cream segment accounting for approximately 3% of this figure.

Unilever Plc intends to separate its ice cream business, home to well-known brands such as Ben & Jerry’s and Magnum, into a standalone entity as part of a cost-saving initiative. This move is expected to result in 7,500 job cuts. The separation process will begin promptly and is anticipated to conclude by the end of 2025.

“The separation of Ice Cream and the delivery of the productivity programme will help create a simpler, more focused, and higher performing Unilever. It will also create a world-leading ice cream business, with strong growth prospects and an exciting future as a standalone business,” said Ian Meakins, Chair of Unilever.

As a component of a broader restructuring initiative to expedite growth, CEO Hein Schumacher is rationalising operations at the UK consumer-goods corporation. The company emphasised that job cuts are integral to its Growth Action Plan, targeting €800 million in cost reductions over the next three years.

The Unilever Board asserts that the company's focus should centre on a portfolio of exceptionally superior brands within highly appealing categories, complemented by corresponding operating models. Citing the distinct operational structure of its Ice Cream business, the Board has concluded that the separation of the Ice Cream division will optimise future growth prospects for both Ice Cream and Unilever, as stated in a release.