Consumer goods giant Unilever has agreed a US$44.8bn deal to merge its food business with US-based spice and seasoning company McCormick.
Following the move, the Anglo-Dutch company would control 65% of the new spin-off and its core focus would be on beauty, personal care and home products, The Guardian wrote on 31 March.
The merger would combine Unilever’s food brands such as Marmite spread, Hellmann’s mayonnaise, Knorr and Pot Noodle, with McCormick’s condiments and spices including French’s mustard, Old Bay seasoning and Cholula hot sauce, the report said.
Completion of the deal was expected by mid-2027, subject to McCormick shareholder approval, receipt of required regulatory approvals and other customary closing conditions, Unilever said in a 31 March statement on its website.
“It will unlock value, enhance the group’s structural growth profile and simplify the portfolio,” the company said.
Unilever uses oils and fats in the production of many of its products, with soyabean oil used in dressings – including Hellmann’s mayonnaise – palm oil used in the company’s soaps and shampoos and shea butter used in some of its body wash products.
Last year, Unilever sold off its ice-cream division, the home of Ben & Jerry’s, Magnum and Wall’s.
In addition, over the past decade, the company had sold off its spreads business, which included brands such as Flora and I Can’t Believe It’s Not Butter, in 2017; most of its tea business, including Lipton, PG Tips and Tazo in 2022, before last year’s listing of the ice-cream business.
The new combined company will be called McCormick and be led by its executives, with senior management representation from the ranks of Unilever’s food business, according to The Guardian report.
Savings would come from changes in manufacturing, distribution and on procurement of supplies, the companies said.
“We are unlocking trapped value through a growth-led separation of foods,” said Fernando Fernández, Unilever’s chief executive.
“Our retained ownership stake reflects our conviction in the strength of the combined company and its future prospects.”
Last year, the food business accounted for just over a quarter of Unilever’s overall annual sales of €50.5bn (US$67bn), Reuters reported on 31 March.
