Unilever delays fifteen billion euro ice cream spin off amid US government shutdown

Unilever’s plan to demerge its €15 billion ice cream division has been pushed back due to the ongoing shutdown of the US federal government. The global consumer goods group had expected to spin off its highly profitable ice cream business — which includes beloved brands such as Magnum, Ben & Jerry’s, and Viennetta — by mid November. However, Unilever has notified shareholders that the delay is a direct result of the US Securities and Exchange Commission’s inability to register shares for trading on the New York Stock Exchange during the US government’s closure.

The spin off, set to see the new Magnum Ice Cream Company listed in Amsterdam with secondary listings in London and New York, is central to chief executive Fernando Fernández’s turnaround strategy. By focusing the group’s future on beauty and personal care, Fernández intends to move away from operationally complex and lower margin businesses such as ice cream, which presently make up about fifteen per cent of group revenues.

Unilever has reassured investors of its commitment to completing the demerger within 2025, though a new timetable has not been presented. The company highlighted that all preparatory work remains on track, and updates regarding the revised schedule will be provided as soon as practical. A recent vote by shareholders also approved a share consolidation related to the demerger.

Although the company could technically bypass the government shutdown by removing the delaying amendment from its SEC registration — which would result in automatic effectiveness after twenty days — experts warn that this approach introduces heightened risks for both issuers and investors. The complexity of the demerger has not gone unnoticed, as the ice cream division has consistently outperformed other parts of Unilever’s business, and the separation has met some scepticism amongst market observers.

The soon to be listed Magnum Ice Cream Company aims for annual sales growth of three to five per cent from 2026, with a target free cash flow of €800 million to €1 billion by 2028 and 2029. Unilever plans to retain a near twenty per cent holding for up to five years, gradually selling down this stake over time. The decision to proceed with the split comes as Unilever’s share price has declined three per cent in the last year, underscoring pressure for transformational change within the FTSE 100 group.

Meanwhile, tensions have re-emerged between Unilever and the original Ben & Jerry’s founders, who have written to the soon to be spun off division’s board urging for the brand to be given greater independence ahead of its flotation. Disagreement over Ben & Jerry’s social and political stances, particularly in relation to sales in the Israeli occupied West Bank, has fuelled ongoing disputes and litigation between brand and parent company. These dynamics add another layer of complexity to what is one of the most closely watched splits in the consumer goods sector this year.