Unilever said Tuesday, March 31, it had agreed a multibillion-dollar deal with US spices maker McCormick & Company to spin off most of its food business.

Brands including Hellmann’s mayonnaise and Knorr seasonings owned by consumer goods giant Unilever will combine with McCormick’s Schwartz and Ducros herbs to form a new business, according to company statements.

The combination, which is expected to be completed by mid-2027, will create a “global flavour powerhouse,” with a portfolio of iconic brands that generated revenues of USD 20 billion (EUR 17.4 billion) on fiscal year 2025, stated the two groups in a joint statement. The Transaction reflects an enterprise value of USD 44.8 billion (EUR 39 billion) for Unilever Foods. Furthermore, the combination excludes Unilever’s food business in India.

As part of the deal, McCormick will pay Unilever USD 15.7 billion (EUR 13.7 billion) to Unilever. Upon completion of the transaction, McCormick shareholders will hold 35% of the combined entity, Unilever shareholders will hold 55.1%, and Unilever will retain a direct 9.9% ownership stake.

Home and personal care

However, Unilever has stated its intention to progressively divest this stake, aligning its strategy with a sole focus on household products, personal care, and cosmetics.

“For Unilever, this transaction is another decisive step in sharpening our portfolio and accelerating our strategy towards high-growth categories,” said Fernando Fernandez, Chief Executive Officer of Unilever.

The sale of the food division, following that of the ice cream division, brings Unilever’s turnover back to around EUR 39 billion.

Following the separation, and based on FY25 revenues, 67% of Unilever’s turnover will come from Beauty, Wellbeing, and Personal Care products (compared with 51% in FY25). “These categories share structural tailwinds driven by premiumisation, science-led innovation and exposure to faster-growing channels,” the group emphasized.

The United States and India will contribute 38% of group turnover (vs. 33% in FY25), with emerging markets accounting for 62% (vs. 59%). This will increase Unilever’s exposure to faster-growing regions, supported by population growth, urbanisation, rising household numbers, higher female labour participation, and expanding wealth.

Furthermore, the group now has a structurally more premium brand portfolio, with greater exposure to digital channels.

"While Unilever’s food operations generate strong margins, growth has lagged behind its personal care and beauty brands," said AJ Bell investment director Russ Mould.