Associated British Foods (ABF) has announced plans to demerge Primark, its budget fashion retail chain, from its food business — which includes brands like Kingsmill, Twinings, and a sugar division. The move follows a strategic review and would create two separate, focused public companies. This marks one of the most significant structural shifts in ABF's history as a diversified conglomerate.
Conglomerate break-ups frequently unlock what analysts call a 'sum of the parts' discount — meaning the combined company trades cheaper than its divisions would be worth independently. ABF shareholders could benefit if Primark and the food business are each re-rated upward as standalone entities. Retail and consumer staples funds holding ABF should watch closely, as the split could trigger index rebalancing and fresh institutional interest in both new companies.
Watch for ABF's formal demerger announcement and shareholder vote date (likely H2 2025). Monitor UK regulatory filings with the Financial Conduct Authority for prospectus details. Track Primark's next trading update for standalone revenue figures that will set its independent valuation baseline.
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