Unilever said Tuesday it had agreed a multibillion-dollar deal with US spices maker McCormick & Company to spin off most of the British group's food business, which is currently valued at $44.8bn (€38.95bn).
Brands including Hellmann's mayonnaise and Knorr seasonings, owned by UK-based consumer goods giant Unilever, will combine with McCormick's Schwartz and Ducros herbs to form a new business.
ADVERTISEMENT
ADVERTISEMENT
McCormick will pay Unilever $15.7bn (€13.65bn) and offer shares under the deal, which sees the US group's shareholders owning 35% of the new business, Unilever taking a 9.9% stake and its shareholders the remainder.
The combined company will retain McCormick’s name and leadership.
However, upon completion, Unilever shareholders are expected to own 55.1% of the food company, as well as 9.9% of outstanding equity, while McCormick shareholders will own 35.0%.
Unilever and McCormick confirmed last month that they were in talks about a deal, with Unilever seeking to streamline its business and focus on beauty and personal care products.
The transaction announced on Tuesday excludes Unilever’s food businesses in India, Nepal and Portugal.
McCormick CEO Brendan Foley said in a prepared statement that the deal “accelerates McCormick’s strategy and reinforces our continued focus on flavour”.
He added that McCormick has “long admired Unilever’s foods business”, which has “a portfolio that complements our existing business, capabilities and long-term vision”.
Shares in both companies rose slightly ahead of the opening bell on Tuesday.
