Private equity firms including Blackstone and Clayton, Dubilier & Rice are evaluating a potential approach for Magnum Ice Cream Company following a decline in the recently listed group’s share price, according to a report by Reuters citing unnamed sources familiar with the matter.
The interest comes less than six months after Magnum, owner of brands including Ben & Jerry’s and Cornetto, was separated from consumer goods giant Unilever and listed on the public markets.
Sources said prospective bidders are monitoring the company’s trading performance and valuation before deciding whether to pursue a formal offer. Magnum’s shares have fallen from highs of around €16.50 earlier this year to near their listing level of approximately €13, after debuting in December with a valuation of roughly €7.8bn.
Unilever continues to hold a 19.9% stake in the ice cream business and has indicated plans to exit its remaining position over the next five years.
Any potential buyout discussions remain preliminary, with private equity firms expected to wait for the company’s summer trading performance before taking further steps. The summer period represents Magnum’s key revenue season, given the highly seasonal nature of the global ice cream market.
Magnum shares rose sharply following reports of private equity interest.
Analysts have noted that structural and tax considerations could complicate a potential take-private transaction. JPMorgan analysts said restrictions tied to the tax-free demerger from Unilever may limit the company’s ability to engage in certain transactions, including mergers or acquisitions, for a two-year period following the separation.
Despite softer investor sentiment linked to changing consumer habits and growing demand for healthier food options amid the rise of GLP-1 weight-loss drugs, some buyout firms are said to view Magnum as a potential operational turnaround opportunity.
Sources indicated that private equity investors could focus on cost reduction initiatives and margin improvements to narrow the profitability gap with competitor Froneri, the ice cream joint venture backed by PAI Partners and Nestlé.
Magnum estimates that it controls approximately 21% of the global ice cream market, compared with around 11% for Froneri.
