Unilever’s food division could be worth as much as €31bn (£26.8bn) if the CPG giant proceeds with plans to carve-out the unit containing the likes of Hellmann’s, Knorr and Pot Noodle as a standalone business, according to City analysts.
Unilever is in the early stages of weighing up a full separation of its food assets as the group continues to focus on higher-growth homecare, beauty and personal care brands under CEO Fernando Fernandez, Bloomberg reported earlier this week.
Any move is not expected until 2027, but options on the table include a spin-off of the €12.9bn turnover division or the possibility to retain flagship power brands while separating the rest of the portfolio.
It also emerged this week Unilever and Kraft Heinz recently held talks for a megamerger of the former’s food business with the latter’s condiments division. The discussions – which have now ended – took place ahead of Kraft Heinz’s decision to call off a planned break-up into two distinct companies in February, The Financial Times reported.
The latest stories follow speculation late last year that Unilever was considering a sale of historic brands such as Marmite, Bovril and Colman’s, with The Vegetarian Butcher, Graze and Dutch brands Unox and Zwan already divested and a demerger of the Magnum Ice Cream Company completed.
Warren Ackerman of Barclays said the timing of exploring a separation of food was strange, coming quickly after a complicated, 18-month ice cream spin-off.
“The exit of Magnum overshadowed almost everything else and was a big distraction,” Ackerman added. “That said, at some point, Unilever will need to rip off the band-aid and one could argue there is never a good time, but we don’t think the timing is now given everything else going on.”
Food accounted for 25% of Unilever’s €50.5bn annual revenues in 2025, with a sales split of 55% from emerging markets and 45% in developed markets. Its top five markets are the US at 16% of revenues, India 11%, China 5%, the Netherlands 5% and the UK 4%.
Growth over the past five years has been minimal, with sales in 2025 just €400m higher than in 2020 and volumes over the period flat.
Knorr, Hellmann’s and Horlicks are the only food brands featured in Unilever’s 30 top ‘power brands’ and account for 70% of the division’s sales.
Barclays estimated the value of a standalone Unilever food business to be in the range of €28bn to €31bn, representing an adjusted EBITDA multiple of nine to ten times.
But Ackerman said Unilever should bide its time and focus all resources on delivering strong results in 2026, keeping possible options around foods in house until concrete value-creating options were realistically on the table.
“Its foods business is one of the most profitable in the world, has 50% plus sales in emerging markets and will likely thrive outside Unilever,” he added.
“However, we think it needs to be taken step by step. Unilever has just completed a big piece of work with Magnum and the focus this year needs to be… [on] improving the performance of foods. However, assuming Unilever deliver in 2026, and, hopefully, with a more stable consumer backdrop, it would be better positioned to consider its options from a real position of strength.”
Unilever declined to comment.
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