Unilever’s Magnum Ice Cream Co trades at €7.8bn value

Unilever Plc’s spinoff The Magnum Ice Cream Co was valued lower than some analysts expected in its debut on Monday, as the world’s biggest ice cream company looks to revive its performance as a standalone firm.

Magnum shares opened at €12.20 in Amsterdam on Monday, before rising to trade slightly above the technical reference price of €12.80, which gave the company a market value of €7.9 billion. Shares also opened in London, and were set to start trading in New York later Monday as part of the triple listing.

Steady early trading indicates investors were aligned with the lower-than-expected market capitalisation. Analysts said the valuation balanced so-called flow back — when investors are forced to sell because they’ve been handed shares that fall outside of their mandate of tracking benchmarks — and expectations around the firm’s future prospects.

“By making the valuation attractive, it means that you attract a few more investors looking for the medium-term growth story, and take away the pressure from the index-related companies that have to sell,” said Fernand de Boer, an analyst at Degroof Petercam, who expected a reference price of €15. The reference price was set by Magnum and Unilever’s advisors as an indicative level ahead of the debut.

Unlike Unilever, Magnum is not expected to be included in the UK’s FTSE 100 index or the Stoxx Europe 50 index, meaning funds designed to track those benchmarks may be forced to sell the shares. In total there will be an expected selling of about 30 million shares as a result of index changes, JPMorgan Chase & Co analysts led by Pankaj Gupta wrote in a note last month. The company will have about 612.3 million shares in issue, filings show.

The market capitalisation was also lower than expectations set by analysts at Oddo BHF and Barclays Plc.

“We assume a more settled price won’t be established until at least next week,” David Hayes, managing director of consumer staples research at Jefferies Financial Group Inc said. The trading price is in the middle of the €10 to €15.5 range the bank published on Friday.

The company, which owns the Ben & Jerry’s and Cornetto brands, is debuting a month later than initially planned after the listing was delayed by the US government shutdown. Magnum is planning to use its newfound independence to focus on boosting its growth, after having been Unilever’s least profitable division.

“Our mission is very clear: the business was not growing fast enough. It needed to grow 1% to 2% faster and profitability was 400, 500 basis points too low,” Magnum’s chief executive officer Peter ter Kulve said in an interview Monday morning before markets opened.

Ice cream is “perceived to have challenges” from health-conscious consumers and weight-loss drugs, as well as being a capital-intensive business, Jefferies analysts, including Hayes, wrote in a note last week. But they see the management team as “well regarded” and say the company can now reinvest in growth, after focusing on returns and cash under Unilever.

For Unilever’s shareholders, the spinoff comes after years of lacklustre share price performance. Its stock opened trading at £43.42 per share in London on Monday. Investors are being handed one share in Magnum for every five shares they own in the parent company.

Unilever decided to split off its ice cream unit last year as part of efforts to streamline its business and revive growth. The unit was briefly considered for sale to a private equity firm, but Unilever ultimately settled on a three-exchange spinoff.

The ice cream business’ high production and storage costs have weighed on margins in recent years. Magnum is targeting annual organic sales growth of 3% to 5% from next year, broadly in line with the global market, and free cash flow of between €800 million and €1 billion in 2028 and 2029.

Shares are trading under the symbol MICC.

© 2025 Bloomberg

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