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Demerges ice cream business; Amsterdam is primary listing

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Move seen as blow to UK's Reeves, despite listing reforms

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Shares fall 6.9% in London after results, announcement

(Adds UK business minister comment in paragraph 8; CEO comment

in paragraphs 13 and 18)

By Yadarisa Shabong and Richa Naidu

Feb 13 (Reuters) - Ben & Jerry's ( UL ) maker Unilever ( UL )

will spin out its ice cream business and has chosen Amsterdam

for its primary listing, it said on Thursday, in a blow to

British finance minister Rachel Reeves' efforts to attract IPOs

to London.

Unilever ( UL ) announced the details of the listing alongside

annual results and a 1.5-billion-euro ($1.6 billion) share

buyback.

Its shares dropped nearly 7% in London where the group has

its main listing, wiping off about 8.5 billion pounds of its

market value, after Unilever ( UL ) also said it expected a slower

start to 2025 due to subdued market growth in the near term.

CEO Hein Schumacher had laid out cost cuts at the company

last year, including separating the ice cream division through a

demerger and cutting thousands of jobs to address years of

underperformance.

The ice cream business, which includes the Magnum and Wall's

brands, will have secondary listings in London and New York. It

generated turnover of 8.3 billion euros ($8.6 billion) in 2024.

The decision will likely be a blow to Britain's Reeves, who

met executives from Unilever ( UL ) last September, with the official

register of meetings describing it as a discussion on investment

in the United Kingdom and capital markets and reforms.

Reeves' office did not immediately respond to a request for

comment.

Business minister Jonathan Reynolds told reporters that

Britain had more work to do to attract stock market listings in

addition to reforms last year and other measures taken by the

London Stock Exchange.

Britain is still hoping to attract online fast-fashion

retailer Shein, which Reuters has reported is expected to list

in London for $50 billion.

In the Netherlands, Dirk Beljaarts, the minister of economic

affairs, said the decision by Unilever ( UL ) confirmed the company's

"confidence in the Netherlands and underscores the

competitiveness and attractiveness of our business climate".

It would have been difficult for Reeves to woo Unilever ( UL )

given it had made commitments to the Dutch government back in

2020 that it would choose the Netherlands if it ever planned to

spin off its food and refreshment business. Unilever ( UL ) had picked

London as its main stock listing and tax venue when it

simplified its dual legal structure.

Its shares also trade in Amsterdam and New York.

UK officials implemented listing reforms last year aimed at

helping London compete with New York and the European Union

following Brexit, but the changes have yet to yield a noticeable

turnaround in initial public offerings amid a long spell of

outflows from UK funds.

Equipment rental firm Ashtead Group ( ASHTF ), for instance,

announced plans in December to shift its listing to New York,

where many companies believe they can get a higher valuation.

Unilever ( UL ) will continue to invest in Britain, Schumacher said

on a call with reporters, saying the choice of Amsterdam for the

ice cream business listing was about operating logic, minimising

costs and commitments made to the Dutch government.

CONTENTIOUS RELATIONS WITH BEN & JERRY'S

The listing might be complicated by Unilever's ( UL ) increasingly

contentious relationship with the independent board of Ben &

Jerry's ( UL ), which ratcheted up a censorship lawsuit against

Unilever ( UL ) last month.

It accused its parent company of suppressing a social policy

statement the U.S. ice cream maker wanted to release because it

mentioned President Donald Trump.

The brand and Unilever ( UL ) have been publicly at odds since 2021

when Ben & Jerry's ( UL ) decided to stop selling Cherry Garcia, Chubby

Hubby and other ice cream flavours in the Israeli-occupied West

Bank because it said it was inconsistent with the company's

values.

Schumacher said he did not believe the Ben & Jerry's ( UL )

litigation would stand in the way of the Amsterdam IPO.

A demerger of the business had been the most likely option,

Barclays analysts said, as such assets in consumer staples often

perform well because they are pure plays.

Consumer health firm Haleon, spun out from drugmaker GSK

in 2022, has seen its market value grow by about 5

billion pounds to 35.4 billion pounds since its listing.

Jean-Francois van Boxmeer has been appointed chair designate

for the separated ice cream business, Unilever ( UL ) said.

The group forecast 2025 underlying sales growth to be within

its multi-year range of 3%-5%.

Tineke Frikkee, a portfolio manager at Waverton Investment

Management, a Unilever ( UL ) investor, said Thursday's decline in

shares was down to a lack of positive momentum for the first

half of 2025 and a risk quarterly forecasts will not be met.

Unilever ( UL ) reported fourth-quarter underlying sales growth of

4% on Thursday, compared with a 4.1% forecast by analysts in a

company-compiled poll.

($1 = 0.9584 euros)