Associated British Foods (ABF) has fingers in many pies when it comes to food, owning both bread brand Kingsmill and tea brand Twinings.
It does not just own food businesses, however. It also has a fashion arm, containing one of the biggest names in fast fashion, Primark.
This could soon change. The business suggests that it may separate the two sides of its operations.
The company is considering whether its retail and food businesses “have now reached a point in their development where they would each benefit from greater independence and a clearer line of sight into their respective activities‚” said chairman Michael McLintock during ABF’s Q3 investors’ call.
Such a split could especially benefit ABF’s food businesses, he suggests
While he stresses that no announcement had yet been made and ABF needs to confirm whether it is feasible, he said that stakeholders were being consulted and that there is a “fair chance” of the split occurring.
The announcement comes during significant declines in the company, with its food businesses in particular suffering blows, amid a “challenging external backdrop”.
Revenues declined by 1% for the company, with a decline of 12% for adjusted operating profit. In individual segments, the adjusted operating profit of its agriculture division declined, and sugar failing to grow following the recent closure of the company’s Vivergo bioethanol plant.
This comes after the brand merged Kingsmill with former rival Hovis, just a few months ago.
