Unilever confirms talks to sell food unit to McCormick

The basics:

• Unilever in discussions with McCormick to sell food division
• Food unit includes Hellmann’s, Knorr, Marmite, sauces, soups, seasonings
• Division comprises about $14.9B of Unilever’s total 2025 sales
• Sale aligns with Unilever strategy to focus on beauty, personal care, household products

Consumer packaged goods giant Unilever has confirmed talks are underway to sell its food business to flavor company McCormick & Co.

In a March 20 statement responding to “media speculation,” the company said it received an offer but noted “there can be no certainty that any transaction will be agreed.”

Unilever also said, “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 came hours after The Wall Street Journal published a story on talks. Sources familiar with the matter said a deal could potentially come together by the end of the month.

Considered one of the largest CPG companies in the world, Unilever’s portfolio includes powerhouse brands like Dove soap, Hellmann’s mayonnaise, Axe body care and Vaseline petroleum jelly.

It is headquartered in London but has its North American base in Hoboken at Waterfront Corporate Center. Prior to relocating to its brand new office last year, the company spent decades in Englewood Cliffs.

Becoming a ‘more focused company’

For Unilever, a sale would mark the latest move in a continuing effort to slim down its portfolio to concentrate on faster-growing divisions, like beauty & well-being, personal care and household.

As part of a company-wide restructuring effort, Unilever spun off its ice cream division into a standalone business last year. At the time, Unilever said the separation will enable it to become “a simpler, more focused company.” It also said that the ice cream business – a portfolio that includes Good Humor, Yasso, Magnum, Talenti and Ben & Jerry’s – will perform better on its own.

Besides Hellmann’s, the food business also includes Knorr bouillon, soups, seasonings, sauces, pasta and rice; and Marmite spreads. The unit made up about a quarter of the company’s total sales in 2025 ($14.91 billion). However, the division is growing more slowly than Unilever’s overall business.

The possible separation comes as many CPG companies trim portfolios in response to challenges like consumer shifts away from processed food, tariffs and rising energy prices, according to Reuters.

Earlier this week, The Financial Times reported that Unilever mulled merging its food assets with Kraft Heinz’s condiments business but the talks ended.

Bloomberg estimated Unilever’s food business has a potential equity value of $33 billion, far exceeding McCormick’s $14.5 billion market cap.

The outlet also noted that a sale of Unilever’s food unit would bring an end to the company competing with rivals like Nestle, PepsiCo and Kraft Heinz Co. The move could transform Unilever into a major household and personal care company on par with L’Oreal and Estee Lauder, Bloomberg added.

Spicing up it for shareholders

Following Unilever’s announcement, McCormick issued its own statement regarding a potential transaction.

“While these discussions are ongoing, there can be no certainty or assurances as to whether an agreement for a transaction will be reached or as to the terms or timing of any such transaction. McCormick regularly evaluates its portfolio and strategic options in pursuit of maximizing shareholder value and consistent with its fiduciary duties and in consultation with its financial and legal advisors,” the Maryland-based company said.

A global leader in flavor, McCormick makes, markets and distributes herbs, spices, seasonings, condiments and flavors to retailers, food manufacturers and foodservice businesses. The 137-year-old company’s most popular brands are McCormick, French’s, Frank’s RedHot, Old Bay and Stubbs.

Sources told WSJ that McCormick’s offer to Unilever was unsolicited.

Its last high-profile deal was in 2020, when it paid about $800 million for Cholula. In 2017, McCormick paid $4.2 billion to purchase Reckitt’s North American food business, including brands such as Frank’s RedHot and French’s mustard.