Unilever announced on Tuesday it would spin off its ice cream unit, home to popular brands such as Magnum and Ben & Jerry's, and cut 7,500 jobs as part of a new cost-saving plan.
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Investors cheered the plan, sending the global consumer goods company's shares up nearly 6% at one point.
The spinoff will begin immediately and is expected to be completed by the end of 2025, London-listed Unilever said. The ice cream business is "in the process of moving to a separate head office in Amsterdam," but CEO Hein Schumacher said on a call with journalists that he was "open to options" regarding where it could list.
The plan was welcomed by the fund of activist investor and board member Nelson Peltz, and by Unilever shareholder Aviva.
Unilever said it aims to deliver mid-single-digit underlying sales growth and modest margin improvement after the split. The ice cream business accounts for about 16% of Unilever's global sales and in some countries contributes one-third to 40%.
The group, whose other brands include Dove soap, Marmite, and Hellmann's condiments, also launched a program to save costs of around $869 million over the next three years. The proposed changes would impact around 7,500 jobs globally, mostly office-based, with total restructuring costs anticipated to be around 1.2% of overall turnover during the period.
The cuts will affect about 5.9% of Unilever's workforce of about 128,000 people.
"We are looking across the organization, so in our head office, corporate center, as well as in business group coordination points, as well as in business units in countries," Schumacher said, but did not elaborate on which regions would be hit hardest by job cuts.
The move is a big statement from Schumacher, who became CEO in July and in October laid out plans to win back investor confidence by simplifying the business after admitting Unilever had underperformed in recent years. His predecessor, Alan Jope, was criticized for allowing the group's brand portfolio to grow to about 400, leaving management distracted from its best performers.