Unilever, the global consumer goods giant, has made a significant decision to list its ice cream division primarily in Amsterdam. This move is seen as a setback for London’s struggling IPO market and a blow to efforts by the UK government to increase listings on the London Stock Exchange. Unilever’s ice cream division, which includes well-known brands like Ben & Jerry’s, Magnum, Breyers, and Wall’s, will be spun off into a separate entity by the end of 2025, with secondary listings in New York and London.
Despite Unilever itself being primarily listed in London, it has chosen Amsterdam as the main listing location for its ice cream business. This decision has raised eyebrows, as it signals a lack of confidence in London’s appeal for new listings. It also reflects the company’s shift in priorities and its focus on optimizing the business structure to maximize shareholder returns. This marks a shift in Unilever’s corporate strategy, which is expected to have far-reaching implications for the company and the UK’s financial landscape.
Why Amsterdam?
Unilever’s CEO, Hein Schumacher, explained that Amsterdam was chosen for the primary listing due to the ice cream division’s senior management being based in the Dutch city. The ice cream division’s headquarters are located there, and this was a key factor in the decision. However, Unilever was quick to emphasize that significant operations would remain in the UK. For instance, the global research and development center and the Wall’s factory in Gloucester will continue to operate in the UK. This demonstrates that while the listing will be based in Amsterdam, key operations will still be closely tied to the UK.
Unilever’s decision to list the ice cream division in Amsterdam has left many wondering about the future of London’s financial sector. The UK government has been working hard to attract more listings to London to maintain its position as a global financial hub. However, this latest development highlights the challenges London faces in competing with other financial centers like Amsterdam and New York.
Unilever’s move is particularly notable as it comes amid ongoing efforts by the UK government to revitalize the IPO market. In recent years, London has struggled to attract major new listings, especially compared to other cities like New York. The Unilever decision adds to concerns about the future of London’s position in the global financial market.
Unilever’s Focus on Shareholder Returns
The decision to spin off its ice cream division is part of a broader strategic shift for Unilever. The company is focused on maximizing shareholder returns, and the ice cream business is expected to become a standalone entity that can operate more efficiently and independently. This move follows a thorough review by Unilever’s board, which concluded that separating the ice cream division would unlock value for shareholders.
The company has also made significant adjustments to its overall business strategy. As part of its efforts to optimize its portfolio, Unilever has been investing in premium brands like K18 and Minimalist, while divesting from local food brands such as Unox and Conimex. CEO Hein Schumacher has emphasized the company’s shift towards focusing on cooking aids and condiments, which he believes will drive long-term growth.
Unilever’s Financial Results and Outlook
In addition to the announcement of the ice cream business spin-off, Unilever also released its financial results for the full year of 2024. The company reported a 4.2% increase in underlying sales, driven by a 2.9% rise in volume. Turnover for the year grew by 1.9%, reaching €60.8 billion. Unilever’s underlying operating margin increased by 170 basis points to 18.4%, while its gross margin advanced by 280 basis points. These results reflect Unilever’s ability to weather challenging market conditions and continue to deliver growth.
Schumacher highlighted that Unilever is making strategic portfolio adjustments to focus on premium products, which is in line with the company’s long-term growth strategy. “We are focusing our food portfolio on cooking aids and condiments,” Schumacher said. This shift aligns with broader consumer trends, as demand for healthier, more sustainable food products continues to rise.
Unilever also faces challenges in markets like Indonesia and China, where it has been implementing transformative measures to improve its operations. The company expects to see the benefits of these actions in the second half of 2025, although growth in these regions is expected to remain weak during the first half of the year.
Despite these challenges, Unilever remains optimistic about the future. The company anticipates a recovery in market conditions during the latter half of 2025, as the measures taken to streamline operations begin to bear fruit.
Implications for London’s IPO Market
Unilever’s move to list its ice cream division in Amsterdam highlights a broader issue for London’s IPO market. The UK government has been working hard to attract more companies to list in London, but this latest setback shows that more needs to be done to make the city an attractive destination for global businesses. While London remains an important financial hub, its ability to attract major new listings is under pressure.
Unilever’s decision is just one example of the challenges facing the UK’s financial sector. Other companies may follow Unilever’s lead and opt for listings in other financial centers like Amsterdam or New York. This trend could have long-term consequences for London’s status as a leading financial center.
What’s Next for Unilever?
Unilever’s decision to spin off its ice cream business is a major milestone in the company’s transformation. The separation is on track to be completed by the end of 2025, and the ice cream business is expected to operate as a standalone entity. Unilever has made significant progress on key workstreams, including legal entity setup, implementing a standalone operating model, and preparing carve-out financials.
As the company continues to make strategic adjustments, it will be interesting to see how the ice cream business performs as a separate entity. Unilever’s portfolio of brands, including Dove, Knorr, and Vaseline, remains strong, and the company is well-positioned for future growth. However, the decision to list in Amsterdam rather than London raises questions about the future of the UK’s IPO market and its ability to compete on the global stage.
For more details on Unilever’s financial performance and strategic moves, visit Newyork Mirror.
