McCormick makes offer for Unilever food division in potential multibillion-dollar deal

Unilever has confirmed it received an offer from McCormick for its food division, which includes Hellmann’s, Knorr, Marmite, and Colman’s, in what could be one of the largest food industry deals in years. The companies issued separate statements on Friday confirming they are in discussions, though both cautioned there is no certainty a transaction will be agreed.

Bloomberg reports the deal would be structured as a Reverse Morris Trust — a tax-free merger in which Unilever would spin off the food business and combine it with McCormick — and could come together by the end of March.

“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,” Unilever says in a statement. McCormick says it is in discussions with Unilever about a potential transaction and does not intend to comment further until necessary.

Unilever’s food division posted turnover of €12.9 billion (US$14.3 billion) in 2025, while McCormick has a market capitalization of around US$14.5 billion, according to LSEG data cited by Reuters.

Unilever explores selling its food division as part of a strategic shift toward higher-margin businesses.Barclays analyst Warren Ackerman estimates the enterprise value of Unilever’s food business at roughly €30 billion (US$33.4 billion), based on its operating profit of €2.9 billion (US$3.34 billion) last year. In other words, the target is substantially larger than the buyer — which is why a Reverse Morris Trust structure, in which Unilever shareholders would retain a majority stake in the combined entity, is being considered.

The Wall Street Journal, which first reported the McCormick talks yesterday, described the potential transaction as an all-stock deal. Maryland-based McCormick generates annual revenues of around US$6.8 billion and is known for its red-topped spice brands, Cholula hot sauce, and French’s mustard. Its B2B Flavor Solutions arm — which develops custom seasoning blends, liquid flavor systems, and taste modulators for food manufacturers — posted 9% operating profit growth in fiscal 2025, outpacing its consumer retail segment.

A combination would bring together McCormick’s sauce and seasoning portfolio with Unilever’s Hellmann’s and Knorr — which together account for roughly 60% of the food division’s revenue — creating a condiments and flavor powerhouse with a presence across retail, foodservice, and B2B ingredient supply.McCormick offers to acquire Unilever's food division, creating a global condiments and flavor leader.

The McCormick approach follows earlier talks between Unilever and Kraft Heinz about a possible merger of their respective food and condiments assets, which have since ended. It also marks a rapid escalation from earlier this week, when Bloomberg first reported Unilever was in the early stages of considering a full separation of its food business.

Under CEO Fernando Fernandez, Unilever has been pivoting toward beauty, personal care, and well-being — higher-margin categories that generated more than double the food division’s turnover in 2025. The company completed the demerger of its ice cream division into The Magnum Ice Cream Company in December and has already offloaded Graze, The Vegetarian Butcher, Unox, and Zwan.