Unilever reaches deal to keep selling Ben & Jerry’s ice cream in Israel

Consumer products giant Unilever said it reached a deal that will let its Ben & Jerry’s ice cream continue selling in Israel.

The company said Wednesday that it sold the Israeli branch of the ice cream company for an undisclosed sum to Avi Zinger, whose American Quality Products already licenses Ben & Jerry’s ice cream for sale in the country.

The move by Unilever comes after Ben & Jerry’s, which has an independent board, said last summer that it was stopping sales in the territory that has been occupied by Israel since the Six Day War in 1967.  Palestinians want that land for a state of their own and supporters have gotten behind a global campaign known as “BDS,” which stands for boycott, divest and sanction and encourages people to avoid buying from companies that operate in the area.

Unilever’s sale to Zinger effectively overrides the decision by Ben & Jerry’s independent board last summer.

Ben & Jerry’s and its board chair, Anurandha Mittal, did not immediately respond to requests for comment. Sources inside the company said the board is likely to meet soon to discuss the issue. Mittal was seen as being behind the original decision to pull out of Israel. Ben & Jerry’s Jewish founders, Bennett Cohen and Jerry Greenfield defended the decision in an op-ed to the New York Times last summer.

Ben & Jerry’s decision to pull out of parts of Israel last year was controversial and triggered several states including Florida, Texas, New Jersey and Colorado to start divesting their shares of Unilever.

A representative for activist investor Nelson Peltz, who is set to join Unilever’s board next month, said in a statement that Trian Partners “commends the Unilever team and Avi Zinger for reaching this new arrangement to keep Ben & Jerry’s in Israel and ensure its ice cream stays available to all consumers. Respect and tolerance have prevailed.”

Trian amassed about 1.5% of the company’s shares over the last year. Peltz was granted a meeting with Unilever CEO Alan Jope late last year as part of his role of board chair for the Simon Wiesenthal Center, which fights antisemitism and the delegitimization of Israel.

Israel’s government sees any efforts to boycott business in the country as a threat to its economy. After learning of Ben & Jerry’s decision last year, Israeli Foreign Minister Yair Lapid instructed consulates in the United States to urge Unilever to reverse Ben & Jerry’s decision. 

“The Ben & Jerry’s factory in Israel is a microcosm of the diversity of Israeli society,” said Lapid, who is also Israel’s incoming prime minister, in a statement. “Today’s victory is a victory for all those who know that the struggle against BDS is, first and foremost, a struggle for partnership and dialogue, and against discrimination and hate.”

American Quality Products employs about 2,000 Jewish and Arab Israelis and produces ice cream at four manufacturing plants in the country. It will continue to sell Ben & Jerry’s under Hebrew and Arabic names.