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Unilever and McCormick & Company have agreed to combine Unilever’s Food business, excluding India and certain other operations, with the US-based spice maker creating a combined business with around $20 billion in annual revenue.

The deal will see Unilever separate its food division and merge it with McCormick through a Revere Morris Trust structure, which is not expected to trigger US federal income tax for Unilever or its shareholders.

The transaction values Unilever's Food business at around $44.8 billion, with Unilever set to receive $15.7 billion in cash.

Upon completion, Unilever shareholders are expected to own 55.1% of the combined company, with McCormick shareholders holding 35% and Unilever retaining a 9.9% stake.

The merger marks the most significant strategic move to date by Unilever's CEO Fernando Fernández, who took the helm in March 2025. It follows the spin-off of Unilever’s ice cream business last year, which included brands such as Ben & Jerry's and Magnum.

Fernández said: “This transaction is another decisive step in sharpening our portfolio and accelerating our strategy towards high-growth categories".

"By combining Unilever Foods’ iconic leading brands and global reach with McCormick’s exceptional portfolio, category expertise and capabilities, we are establishing a focused, high-quality business with significant top-line growth and value creation potential.”

The move signals a continued shift away from slower-growing food categories toward higher-margin personal care and beauty segments for the company.

Unilever’s food business, home to legacy brands like Marmite, Colman's and Horlicks, accounts for just over a quarter of its €50.5 billion annual revenue. However, shifting consumer preferences toward fresh and minimally processed foods have challenged long-term growth in the packaged goods segment.

Brendan Foley, chairman, president and CEO of McCormick, said: "This transformative combination accelerates McCormick’s strategy and reinforces our continued focus on flavour".

"Together, we will be better positioned to accelerate growth in attractive categories. This combination will create a diversified flavour leader with a robust growth profile that remains differentiated by its focus on flavouring calories while others compete for them.”

Under the proposed structure, certain assets, including Unilever’s food operations in India, would be excluded from the transaction.

Foley continued: "McCormick is the right partner for Unilever Foods’ brands and employees, and our shared culture and values will empower our combination".

Upon closing, Foley is expected to remain chairman, president and CEO of McCormick, and Marcos Gabriel is expected to remain EVP and CFO. Executives from both companies will serve in key leadership roles.

Unilever will appoint four of the twelve members of the combined company board of directors. In addition, one Unilever executive is expected to serve as one of the four directors appointed for two years to support a successful integration.

McCormick will also maintain its global headquarters in Hunt Valley, Maryland, and have an international headquarters in the Netherlands. Unilever Foods has a long-standing presence in the Netherlands, which is home to its world-leading R&D capability that supports its deep sector expertise.

The combined company is planning to have a secondary stock listing in Europe to reflect the global nature of Unilever’s current shareholder base.

In additional reporting by Reuters, Unilever has imposed a global hiring freeze across all divisions, highlighting mounting pressures on the food and beverage sector as geopolitical instability disrupts supply chains and drives up costs.

According to an internal memo, seen by the news agency, Unilever said the freeze will take effect immediately and remain in place for at least three months.

The decision comes in response to escalating economic uncertainty linked to the ongoing conflict in the Middle East, particularly the intensifying Iran war, which has sent shockwaves through global energy and commodities markets.