Consumer goods giant Unilever is in talks to merge its food business with US-based spice and seasoning company McCormick, according to a report by The Guardian.
If the deal goes ahead, the Anglo-Dutch conglomerate – the owner of Marmite spread, Dove soap and Hellmann’s mayonnaise – would focus more on personal care products, the 20 March report 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 split off its ice-cream division, which included well-known brands such as Ben & Jerry’s, Magnum and Wall’s.
Unilever is valued at almost US$134.15bn and its food unit, which includes brands such as Knorr, could be worth tens of billions of dollars, according to the report.
McCormick, which owns brands including French’s yellow mustard, Old Bay seasoning and Cholula hot sauce, was valued around US$15bn.
In a 20 March statement on Unilever’s website, the company confirmed it had received an inbound offer for its foods business and was in discussions with McCormick & Company.
However, there was no certainty any transaction would be agreed, it added.
“The board believes Foods is a highly attractive business, with a strong financial profile led by market-leading brands in growing categories and is confident in the future of the Foods business as part of Unilever,” the statement said.
The companies were exploring an all-stock deal and, if an agreement could be reached, it would allow Unilever to focus on beauty, personal care and home products, The Guardian wrote.
Earlier this year, Fernando Fernández, the chief executive of Unilever, said the company was looking to shift away from food.
“We are really shifting our portfolio into more beauty, more wellbeing, more personal care,” he told a conference in New York.
In the week prior to The Guardian report, the Financial Times wrote that Unilever had previously held talks with US multinational food company Kraft Heinz to combine their food operations.
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.
If Unilever completed the deal with McCormick, it could mark the end of almost a century of competing against major food rivals including Kraft Heinz, Nestlé and PepsiCo, The Guardian wrote.
