Unilever will spin off its ice cream business, including Ben & Jerry's, to boost profits

Unilever is splitting off its ice cream business, which includes Ben & Jerry's and Magnum, into a standalone business in an effort to boost profits, the company announced on Tuesday, cutting about 7,500 "predominantly office-based" jobs globally.

Ben & Jerry's corporate office in South Burlington did not immediately return a request for comment about whether the cuts will affect Vermont.

Related story:Burlington-born Ben & Jerry's wants to hit 1-million mark on this year's Free Cone Day

The changes are expected to save around $870 million over the next three years. Following the announcement, Unilever's share price spiked by more than 5%, according to RetailWire. In recent years, Unilever has faced increasing pressure from activist investors to revamp its business. The stock price declined by about 6% in the last year, RetailWire reported.

"The Unilever Board is confident that the future growth potential of Ice Cream will be better delivered under a different ownership structure," Unilever said in a press release. "Ice Cream has distinct characteristics compared with Unilever's other operating businesses. These include a supply chain and point of sale that support frozen goods, a different channel landscape, more seasonality, and greater capital intensity."

Unilever wants more growth and bigger margins

Ian Meakins, chair of Unilever, said in a statement the board is determined to "transform Unilever into a higher-growth, higher-margin business that will deliver consistently for all stakeholders."

"Improving our performance and sharpening our portfolio are key to delivering the improved results we believe Unilever can achieve," Meakins said.

The separation of the ice cream business into a standalone business is seen as a way to create a "simpler, more focused, and higher performing Unilever."

"It will also create a world-leading ice cream business, with strong growth prospects and an exciting future as a standalone business," Meakins said.

Unilever's ice cream division had sales of $8.5 billion in 2023.

Contact Dan D’Ambrosio at 660-1841 or ddambrosi@gannett.com. Follow him on Twitter @DanDambrosioVT. This coverage is only possible with support from our readers.