Who would buy Ben & Jerry’s?
The ice-cream brand is too politically toxic for any sane investor to touch
Matthew Lynn City columnist
It is the most radical move Unilever has made since Hein Schumacher was drafted in to lead the conglomerate last year. The business, which manufactures Dove soap and Hellman’s mayonnaise, had drifted for years under the dismal management of Paul Polman. Its shares underperformed rivals such as Nestlé and Heinz, activist investors took larger and larger positions, and the board came under rising pressure to ditch the social activism and political posturing and concentrate on delivering better returns for shareholders.
Last week, it announced plans both to cut 7,500 jobs and, more radically, spin-off its ice cream unit, which includes brands such as Magnum, Ben & Jerry’s and Wall’s, into a separate company, with either a trade sale or a stockmarket listing as the most likely options. A target date of 2025 has been set for the demerger, which will create a substantial new business.
Wild excesses of wokery
It will have value. It has sales of more than £7bn a year, 20% of the ice-cream market, double that of its closest competitor, and margins that, while less than Unilever’s overall, still come in at a respectable 10%. It had falling sales last year as consumers traded down to cheap own-label products, but it is still a valuable business. Barclays estimates it could be worth £17bn once it is spun out of its parent company, and with only a modest improvement in performance and a handful of exciting new product launches, it could be worth a lot more.
There are already reports that one of the big private-equity firms will make an offer, and, with well established brands and scope to improve efficiency, it is the kind of business that would fit perfectly into the portfolio of a buy-out house. The London, Amsterdam and New York stock exchanges will all be pitching for the listing.
Here’s the problem, however. Why would anyone want to own a slice of the Republic of Ben & Jerry’s? After all, this is a company that has become the epitome of the wilder excesses of woke capitalism. In effect, it runs its own foreign policy, and pronounces on every possible social issue. It refused to sell its ice cream in the West Bank, it sparked outrage in the US by putting out a tweet on the fourth of July for the return of indigenous land, and after Russia invaded Ukraine it called on President Biden to resist “fanning t
