ABF May Split Primark from Food Division Amid Tough Market

Published: 04 November 2025. The English Chronicle Desk. The English Chronicle Online.

The parent company of Primark, Associated British Foods (ABF), has announced that it is considering splitting its fashion retail business from its extensive food division, which includes well-known brands such as Twinings, Kingsmill, and Silver Spoon. The potential separation is part of a strategic review aimed at “maximising long-term value” amid a “challenging external backdrop”, the company confirmed on Tuesday.

The review will be conducted in collaboration with Rothschild & Co, one of the world’s leading advisory firms, and is backed by ABF’s largest shareholder, the Weston family’s Wittington Investments. The Weston family, which owns 59 per cent of ABF, is one of the wealthiest business dynasties in the UK and currently ranks sixth on the Sunday Times Rich List 2025, with an estimated fortune of nearly £18 billion.

Despite the potential structural shake-up, ABF has emphasised that the Weston family intends to retain majority ownership of both businesses, regardless of the outcome. The group, currently valued at approximately £16 billion, said that no final decision had been made and that the board would provide updates “as soon as practicable”.

The potential split comes at a time of significant operational and financial turbulence for the conglomerate. Earlier this year, Primark’s long-serving chief executive, Paul Marchant, resigned following an allegation about his behaviour towards a woman in a social situation. His departure marked a rare disruption in leadership for the retailer, which has long been seen as a steady performer within the ABF portfolio.

ABF also reported a drop in annual sales and profits, driven largely by setbacks in its sugar and agriculture businesses, as well as the closure of its Vivergo bioethanol plant. For the financial year ending 13 September, pre-tax profits fell by more than a quarter to £1.4 billion, while total revenues dipped 3 per cent to £19.4 billion.

The group’s sugar division, historically one of its most reliable income streams, posted a £205 million loss as revenues slid 12 per cent to £2 billion. The closure of the Vivergo plant, alongside increased operating costs and lower global sugar prices, significantly impacted performance.

By contrast, Primark’s sales edged up by 1 per cent to £9.5 billion, buoyed by strong performance in the US and continental Europe. While established UK and Irish stores saw a 3 per cent decline in sales, these losses were more than offset by a 20 per cent surge in the American market and a 2 per cent increase across Europe. The retailer continues to expand its global footprint, with more than 470 stores across 18 countries, including 187 in the UK.

However, Primark’s sales growth was tempered by cautious consumer sentiment and unseasonably mild autumn weather, which dampened demand for its typically strong seasonal clothing ranges. The company noted that lower-income households, in particular, had reduced discretionary spending due to continued pressure from rising energy and food costs.

ABF’s wider food division, meanwhile, has undergone its own period of transformation. The group recently merged its bakery operations — which include the iconic Kingsmill brand — with rival Hovis, consolidating its position in the UK’s baked goods market. The closure of Vivergo followed the UK government’s decision to sign a duty-free agreement with the United States for bioethanol imports, effectively undercutting domestic production.

George Weston, the chief executive of ABF and a member of the Weston family, described the year as one of “intense strategic and operational activity” across all sectors of the business. “Most of our divisions have delivered resilient results while navigating an exceptionally challenging external environment,” Weston said.

He added that while Primark continues to thrive as an international retail powerhouse, the company’s food arm remains underappreciated by investors and analysts. “Our food business is less well understood than Primark,” he noted, “but it has a highly attractive portfolio, deep global expertise, and significant potential for future growth.”

Weston emphasised that the review was intended to unlock value across both divisions rather than signal a crisis. “Primark is an incredibly strong international brand with substantial growth opportunities, while our food businesses possess a powerful global presence and extensive capabilities,” he said. “This review will help ensure each business has the right structure to continue growing and delivering value for shareholders.”

The potential split of ABF’s operations mirrors a broader trend among global conglomerates seeking to simplify corporate structures and sharpen investor focus. Similar moves in recent years — including Unilever’s portfolio rationalisation and Kellogg’s decision to spin off its snack division — have been aimed at maximising efficiency and unlocking shareholder value.

Industry analysts suggest that a separation could help both ABF divisions better reflect their true worth in the market. Primark, which operates a low-cost, high-volume retail model without e-commerce sales, could benefit from a more agile corporate setup, while ABF’s food and agriculture interests might attract different types of investors focused on long-term stability.

For now, the company insists that no immediate changes are expected. However, the strategic review signals a pivotal moment for one of Britain’s largest and most diversified companies — and for the family dynasty that has steered it for generations.