LONDON, March 19, 2026, 15:51 GMT
Unilever PLC shares extended losses on Thursday after reports that the company is weighing a separation of its food business and had held, then ended, talks with Kraft Heinz over a tie-up involving part of that unit. Reuters reported the stock was down again after tumbling 3.5% on Wednesday. 1
The issue landed at a sensitive moment. Chief Executive Fernando Fernandez is just over a year into the job and still working through Unilever’s ice-cream demerger, which listed in December as The Magnum Ice Cream Company. Investors fear another large carve-out could pull management away from execution. 2
Bloomberg reported on Tuesday that advisers are studying options that include spinning off most or all of the food unit, though Unilever could still keep the current structure and any move is not expected before 2027. Later on Wednesday, Reuters reported that the Financial Times said earlier discussions with Kraft Heinz about combining Unilever foods with Kraft’s condiments business had ended. 3
Barclays analyst Warren Ackerman said Fernandez “needs another year under his belt” before attempting a split. Reuters also quoted investors worrying the chief executive could get “distracted” so soon after the ice-cream separation. Unilever declined to comment on the food review, and both Unilever and Kraft Heinz declined comment on the reported merger talks. 2
The food arm is big enough to matter. Unilever’s latest results show Foods generated 12.9 billion euros of turnover in 2025 and 2.9 billion euros of operating profit on its adjusted basis. Reuters reported the division made up more than a quarter of group sales and had a 22.6% margin, above the group average. Barclays values the unit at about 30 billion euros. 4
That is the strategic logic, and the snag. Foods grew just 2.5% last year on that same adjusted measure, below Unilever’s 4%-6% goal, while Beauty & Wellbeing grew 4.3%. The packaged-food business is also facing cheaper private-label competition and GLP-1 weight-loss drugs, medicines that can reduce appetite. 2
Competitive pressure is not unique to Unilever. Reuters reported that Reckitt and Nestle shares also fell on Wednesday, while Kraft Heinz last month scrapped its own breakup plan and instead pledged $600 million for a turnaround under new CEO Steve Cahillane. 2
Still, the breakup argument has not come from nowhere. Reuters said investors have for years pushed Unilever to move away from slower-growth food brands, and late last year the company was reported to be considering a sale of Marmite, Colman’s and Bovril as part of that shift. 2
The risk is that a deal sold as value-unlocking proves messy and expensive. W1M portfolio manager Tineke Frikkee said a food demerger was “not straightforward” because tax costs could be high and scale benefits in emerging markets could shrink, while any effort to replace lost sales might revive fears of another big acquisition. 2
For now, the market is not paying up for the theory. Market data showed London-listed shares around 4,650.5 pence on Thursday, about 1.3% below Wednesday’s 4,712.5 pence close, after the previous session’s 3.5% slide. 5
