There aren’t many sweets more beloved than ice cream. Just about everyone has a favorite flavor and knows the best place in town to get it.

Despite its nutritional shortcomings, demand for ice cream is not slowing down. One industry analysis predicts that global ice cream sales will exceed $132 billion by 2032, a roughly two-thirds increase over last year’s $79 billion figure.

That works out to a CAGR (compound annual growth rate) of 6.6 percent, more than double the annual growth rate of global GDP (gross domestic product) this year. There aren’t many products that can match that performance, which is why one of the world’s largest ice cream manufacturers just went public.

Dutch Treat

Until two weeks ago, The Magnum Ice Cream Company (NYSE: MICC) was owned by international consumer products conglomerate Unilever (NYSE: UL). Both companies are based in the Netherlands, although Unilever moved its corporate headquarters to England five years ago for tax purposes.

Be spinning off Magnum, Unilever estimates that it will reduce its labor force by 7,500 workers. It will also lose Magnum’s $9.5 billion in sales this year, a noticeable improvement over last year’s $8.2 billion of revenue.

That’s okay with Unilever, which recorded approximately $60 billion in total revenues last year. The company is now focused on improving its operating metrics so its share price can break out of the trading range it has been stuck in for the past five years.

An Uncompetitive Investment

According to a recent shareholder presentation, Unilever has decided to become a “more focused company” so that it is no longer an “uncompetitive investment” with “inconsistent performance.” By spinning off Magnum, Unilever estimates that its gross margin will improve by 160 basis points (1.6 percentage points).

That assumption is not borne out by Magnum’s share price behavior since it began trading on its own merits. After opening at $14.90 on December 8, MICC traded up to $16.89 at the start of this week.

At that share price, MICC is valued at 22 times trailing EPS (earnings per share). That is about 10 percent less than the same multiple for the S&P 500 Index.

However, the company is priced at only 12 times forward EPS, about half the same multiple for the index. Also, its price to sales ratio of 1.1 is less than a third the 3.4 multiple for the index.

Since Magnum went public, Unilever’s share price is down 3 percent at the same time Magnum’s has risen by four times that amount. Evidently, Wall Street likes the ice cream business more than Unilever does.

Cashing In, Checking Out

Perhaps Unilever’s real motive for unloading Magnum has nothing to do with improving its operating metrics. It may just be that they are tired of arguing with a couple of guys from Vermont named Ben and Jerry.

Twenty-five years ago, Unilever bought iconic American ice cream purveyor Ben & Jerry’s. The founders wanted to cash in on their popular brand and believed that Unilever could expand their customer base overseas.

That aspect of the relationship happened as expected, with Ben & Jerry’s joining Magnum’s other ice cream brands marketed around the world. But over time, Ben and Jerry became disenchanted with Unilever’s corporate priorities versus the founders’ commitment to social activism.

That dispute came to a head nine months ago when Unilever fired Ben & Jerry’s CEO without consulting an independent board. In response, the founders sued Unilever and went public with their complaint against the company.

The two sides could not come to terms, ultimately resulting in Magnum’s IPO two weeks ago. Regardless of how it came to be, it looks like a pretty sweet deal to Wall Street.