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It's a buyers' market for ice cream

Illustration of ice cream cone with a $100 bill sticking out of the side.

Illustration: Eniola Odetunde/Axios

Ice cream portfolios of all sizes are up for auction as both strategic and private equity buyers see promise, industry sources tell Richard.

Why it matters: Activity is stirring despite a decline in ice cream sales and the potential chill of the "Ozempic effect."

The latest: PE firm Peak Rock is selling ice cream portfolio company Turkey Hill, which has between $35 million and $40 million of EBITDA, sources familiar tell Axios. Peak Rock did not respond to a request for comment.

  • That follows a March announcement from Unilever on plans to separate its ice cream business by the end of next year, while Nestlé and PAI are considering a dual-track process for Froneri, Axios confirmed.
  • Nestle and PAI declined to comment. Unilever didn't respond to a request for comment.

Zoom in: Mars Wrigley and The Ferrero Group are both potential buyers for Unilever and Froneri, sources tell Axios.

  • Mars Wrigley, which owns Dove and Trü Frü, has invested in expanding its ice cream manufacturing capacity, while Ferrero acquired the manufacturer that produces brands like Blue Bunny.
  • Both have the size to do a deal, with interest in specific brands in each of the portfolios, sources say.
  • Mars and Ferrero did not respond to Axios' request for comment.

Caveat: Selling the businesses still won't be easy.

  • Their sheer size (Unilever's unit generated €7.9 billion last year, while Froneri could be valued at $10 billion) means a transaction is unlikely to happen without breaking them up.

Behind the scenes: While the preference is to sell, valuations may be more attractive on the public market, which could still lead to IPOs.

State of play: Unilever owns the brands Ben & Jerry's, Magnum, Wall's and Yasso.

  • Nestlé and PAI control Häagen-Dazs, Drumstick, Extrême, Nuii, Outshine, and Rowntree via Froneri.
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