Unilever (UL.US) plans to reduce the number of job cuts in Europe and move some employees to its ice cream business unit.

Market IntelFriday, Nov 15, 2024 8:50 am ET

1min read

Unilever (UL.US) said it will cut about 1,500 fewer jobs in Europe than originally planned and will hire about 1,000 people affected by cost-cutting plans for its soon-to-be spun-off ice cream business, according to the company's European Works Council.

The Anglo-Dutch company, whose shareholders include billionaire activist investor and board member Nelson Peltz, has been working to streamline its business under the leadership of CEO Hein Schumacher in the past year.

Unilever has struggled for years and has been criticized for allowing its brand portfolio to grow to about 400, giving management little time to focus on its best performers.

Some investors have also said the company has been too slow to restore its margins after the pandemic, and that it needs to streamline its business.

Unilever said earlier this year it would cut 7,500 jobs globally as part of a restructuring, saving about â¬800m (US$8.45bn). It also said it would spin off its ice cream business, which includes Ben & Jerry's and Magnum.

The UEWC strongly criticized the decisions, saying the restructuring of the ice cream business could have been done successfully within Unilever.

Hermann Soggeberg, chairman of the UEWC, said Friday the company had agreed to cut about 1,700 jobs in Europe in October, compared with the original plan to cut about 3,200.

"We have been in intensive negotiations with the company all summer," Soggeberg said.

He noted that Unilever was still delivering on its cost savings promises to investors, but through the savings projects from 2022 to 2024, and not hiring externally, the company was able to significantly reduce the number of job cuts in Europe.

Soggeberg said Unilever's European ice cream business would add about 1,000 jobs, mainly for employees affected by the job cuts in other parts of the company.

"They are planning growth for ice cream," Soggeberg said. "We have agreed with Unilever that the recruitment process for these people will be in parallel with the job cuts."

Unilever previously said the spin-off of its ice cream business was expected to be completed by the end of 2025, and that it would move to a separate headquarters in Amsterdam.

Unilever did not immediately respond to a request for comment on the matter.

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