Unilever Indonesia has closed a big deal in selling its ice cream business to The Magnum Ice Cream Indonesia, a significant move by the Unilever Group in its global strategy of unscrambling its ice cream business and focusing back on its core business lines. The transaction is about $440.12 million (Rp 7 trillion) and was sealed through a Business Transfer Agreement (BTA) signed on November 22, 2024.
The deal comprises fixed assets worth, at market value, as of September 30, 2024, Rp 2.55 trillion and net book value worth Rp 1.99 trillion and also inventory worth Rp 172.79 billion. According to an independent valuation by Suwendho Rinaldy & Partners Public Appraisal Services, the fair market value of the transaction is estimated at Rp 6.57 trillion. The sale price represents 204% of Unilever Indonesia’s equity, which was recorded at Rp 3.43 trillion in its financial report for the same period.
At the time of the BTA signing, The Magnum Ice Cream Indonesia was already affiliated with Unilever Indonesia, as both entities are ultimately controlled by Unilever PLC. However, once the transaction is completed, this affiliation will be dissolved, marking a clear separation of the ice cream business from Unilever Indonesia.
This is part of the strategy that Unilever PLC has for streamlining its operations. The parent company, based in London, had earlier announced plans to shed 7,500 jobs and spin off its ice cream business, which includes Magnum and Ben & Jerry’s. The company cited the differentness of its ice cream business as a reason to break apart and said it felt its ice cream business would perform better if owned separately for future growth. It aims to complete this split by the end of 2025.
After the news about the sale, Unilever Indonesia’s stock price gained considerably, increasing by 6.69% on November 25, 2024, to Rp 1,915 after posting a 3.16% gain on November 22. The stock attracted interest, with Maybank Sekuritas reporting a net buy of Rp 32.5 billion and foreign investors contributing a net buy of Rp 39.8 billion.
The transaction is now awaiting approval from shareholders at the upcoming General Meeting of Shareholders (GMS) and an Independent GMS in the near future.
