CEO Alan Jope announced the company will be restructured into five divisions: Beauty & Wellbeing, Personal Care, Home Care, Nutrition, and Ice Cream.
The new set-up sees Hanneke Faber, President Foods & Refreshment, appointed President Nutrition, which will be home to Scratch Cooking, Healthy Snacking, Functional Nutrition, Plant-Based Meat, and Food Solutions. Matt Close, EVP Ice Cream, becomes President Ice Cream, a Business Group in its own right.
The overhauls comes amid much speculation about the company’s future after its rejected £50 billion takeover approach for GlaxoSmithKline’s consumer healthcare division. The bid was met with a backlash from shareholders and investors, spooked at the steep price tag. The company had also run into criticism for sacrificing returns for an excessive focus on corporate sustainability.
Shares then rallied on reports that activist investor Nelson Peltz, owner of the activist hedge fund Trian Partners, had built a stake in the company.
Trian’s history of revamping brands – notably Unilever rival Procter & Gamble – encouraged investors that it could also unlock value at the Anglo-Dutch consumer goods giant by demanding it exit low-growth categories and demerge its food division from its home and personal care business.
“The fox would now appear to be inside the henhouse,” said Martin Deboo, analyst at investment bank Jefferies. He noted that in 2007 Trian prompted a split into confectionery and soft drinks at Cadbury, which concluded with a listing of soft drinks and an eventual take-out of confectionery by Kraft. Trian also argued successfully for splitting Kraft into Kraft Heinz and Mondelez International, though it was unsuccessful in its fight to engineer a split between drinks and snacks at PepsiCo.