As per the company, this decision will enable the ice cream business to operate with greater flexibility and focus
Hindustan Unilever’s board has approved the separation of its ice cream business following a detailed review by a committee of independent directors. The move aligns with the committee’s recommendation on the best path forward for the segment, after evaluating various strategic options.
As per the official statement, “Ice Cream, which contributes 3 per cent to HUL’s turnover, is a high-growth category that needs significant investments to realise its full potential. Ice Cream has a different operating model including cold chain infrastructure, and a distinct channel landscape, which limits synergies with rest of HUL.”
The Independent committee considered that given Unilever owns the trademarks and know-how and has notified the separation of its ice cream business, local capabilities will need to be developed to continue running the Business.
As per the company, this decision will help HUL to focus more on the core business and strengthen its presence in the beauty, foods, health and wellbeing categories. In addition, this is also aimed at enabling the ice cream business to operate with greater flexibility and focus.
In its media statement, HUL stated, “The Company shall make necessary disclosures in accordance with the Sebi Listing Regulations and other applicable laws, post consideration of the matter by the Board.”
The mode of separation has not been determined yet and will be finalised by the end of the current year by the board of the company based on the recommendations of the Independent committee as it looks to maximise value for all shareholders. The decision follows the comprehensive review of the business by the constituted committee.
