Unilever, the company behind Marmite and Dove soap, is set to slash approximately 7,500 jobs globally as part of an extensive three-year cost-cutting strategy. Additionally, it plans to separate its ice cream business, which includes Wall’s, Ben & Jerry’s, and Magnum brands, into a standalone entity by the end of 2025.
Job Reductions and Cost-Cutting Strategy
The restructuring aims to streamline operations and focus on core activities, with job reductions expected to primarily affect office staff, constituting over 5% of the company’s 128,000-strong global workforce. This initiative targets savings of around €800 million (£684 million) over the next three years.
Impact on UK Operations
Unilever’s UK operations, employing 6,000 staff, are responsible for producing ice cream, Marmite, Bovril, and Pot Noodles. Despite generating €7.9 billion (£6.75 billion) in sales last year, the ice cream division operates differently from Unilever’s other consumer product lines due to its reliance on a frozen goods supply chain and seasonal demand.
Rationale Behind Ice Cream Business Separation
![Unilever](https://keratimes.com/wp-content/uploads/2024/03/images-5-4-150x150.jpeg)
The decision to split off the ice cream business is aimed at simplifying operations and enhancing performance. Unilever’s chairman, Ian Meakins, emphasized the move’s potential to create a leading ice cream business with robust growth prospects.
Unilever’s Future Prospects
Following the announcement, Unilever’s shares surged by 5%. Analysts suggest that shedding the underperforming ice cream unit, likely through a demerger, could unlock shareholder value. While the company has not ruled out alternative options such as a direct sale, a demerger appears to be the preferred route, allowing shareholders to decide the fate of the new ice cream business.