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HUL likely to spin-off ice-cream business into separate unit following Unilever
For HUL in India, the ice-cream business accounts for Rs. 2000 crore or around 3 percent of total sales. It includes popular brands like Magnum and Kwality Wall’s.
The board formed a committee of independent directors to explore various alternatives for the ice cream business and provide recommendations. These recommendations will be reviewed by both the Audit Committee and the Board.
Hindustan Unilever (HUL) is pondering turning its ice-cream business into a separate unit for the possibility of a potential sale in the future, reported ET.
The news comes following Unilever’s announcement of spinning off its ice-cream unit, which includes popular brands like Magnum and Ben & Jerry’s.
For HUL in India, the ice-cream business accounts for Rs. 2000 crore or around 3 percent of total sales. It includes popular brands like Magnum and Kwality Wall’s.
In the ice-business, HUL is second in line behind Amul. It also competes with local brands like Vadilal, Naturals, Mother Dairy, Havmor, and Baskin Robbins along others.
ET also reported that HUL’s ice-cream business is unlikely to be bought by any Indian player due to the significant difference in the ice-cream category’s business model. It might be sold to a multinational or to private equity firms. The strategy behind this will be determined by what Unilever chooses to do with its ice-cream business.
Earlier, Unilever CEO Hein Schumacher said on a call with journalists that the ice cream business is currently in the process of moving to a new head office in Amsterdam. However, he said that he is still open to options on where to list the new company.
Unilever’s ice-cream business accounts for around 16 percent of the company’s global sales and in some countries it accounts for a third or about 40 percent, reported Reuters.
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