Spice maker McCormick to combine with Hellmann's maker Unilever in
latest food industry shakeup
[April 01, 2026] WYATTE
GRANTHAM-PHILIPS and DEE-ANN DURBIN
NEW YORK (AP) — Spice and flavorings company McCormick announced on
Tuesday that it’s combining with Unilever’s foods division, which
includes brands like Hellmann’s and Knorr.
The merger is the latest in a string of actions in the packaged food
sector, as companies contend with inflation and changing consumer
tastes. Last year, both Keurig Dr Pepper and Kraft Heinz announced plans
to unwind huge mergers, although Kraft later put that plan on hold. Mars
recently bought Cheez-It maker Kellanova while Nutella maker Ferrero
bought WK Kellogg.
The combined company will maintain McCormick’s name and leadership. But
upon closing, Unilever and its shareholders are expected to own 65% of
the food company's outstanding equity, amounting $29.1 billion. Unilever
would also get $15.7 billion in cash. Meanwhile, McCormick shareholders
will own 35.0%.
McCormick and its red-capped array of spices is a $15 billion company
and the stable of brands it’s adding from Unilever are worth billions
more. The companies said on Tuesday that McCormick and Unilever would
have a combined revenue of $20 billion for the 2025 fiscal year.
McCormick said the deal will give it better access to high-growth
regions like Latin America and Asia, where Unilever has an extensive
presence. It will also expand Unilever's footprint in North America,
where McCormick has a stronger profile.
The companies expect to grow their presence in food service. Unilever
has traditionally been a stronger player in restaurant kitchens, while
McCormick's products are often found more in the dining room, on tables.
The combined companies said they expect to generate $600 million in
annual cost savings.
“Together, we will be better positioned to accelerate growth in
attractive categories,” McCormick CEO Brendan Foley said in a prepared
statement.
The transaction is expected to close by mid-2027, the companies said
Tuesday, pending both shareholder and regulatory approval. The deal
excludes Unilever’s food business in India, Nepal and Portugal.
Unilever, which is based in London, was founded nearly a century ago
when Dutch margarine maker Margarine Unie merged with British soap maker
Lever Brothers. The conglomerate now makes dozens of different brands,
including Dove soap, Vaseline, Hellmann’s mayonnaise, Liquid I.V.
hydration, Axe body spray and Pepsodent toothpaste.
In recent years, Unilever has been shifting away from food in favor of
beauty and wellness categories, where it sees more potential for growth.
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This Tuesday Nov. 24, 2020 photo shows the logo for McCormick & Co.
AP Photo/Donald King, File)
 “For Unilever, this transaction is
another decisive step in sharpening our portfolio and accelerating
our strategy towards high-growth categories,” Unilever CEO Fernando
Fernández said in a statement.
In 2024, Unilever announced it was spinning off its ice cream
business, which included the Ben & Jerry’s, Magnum and Breyers
brands. That business became the Magnum Ice Cream Co., which is
based in Amsterdam. Last year, Unilever sold The Vegetarian Butcher,
a plant-based meat brand, and Graze, a healthy snacking brand.
Unilever's food sales, which make up one-quarter of its total sales,
fell by 3% last year. Many packaged food companies have been hurt in
recent years as consumers shift to cheaper store brands or less
processed foods.
McCormick, based in Hunt Valley, Maryland, has been expanding its
portfolio to take advantage of consumers’ growing interest in global
flavors and sauces. The 137-year-old company bought Reckitt
Benckiser’s food division — including the French’s mustard and
Frank’s RedHot sauce brands — in 2017. In 2020, it bought Cholula, a
Mexican hot sauce brand.
Foley said spices and flavors have remained resilient, transcending
age, culture, dietary preferences and income levels. McCormick's net
sales grew 2% last year.
“Flavor is fully aligned with today’s health and wellness
priorities, as consumers increasingly focus on cooking at home,
adding more protein and produce and pursuing healthier lifestyles,”
Foley said Tuesday during a conference call with investors.
Unilever shares fell 6% Tuesday afternoon while McCormick's shares
slid 5%.
Max Gumport, a senior analyst for BNP Paribas Equity Research, said
in a note to investors that McCormick has a strong track record with
previous acquisitions. But he said investors are likely concerned
about the complexity of the merger and the high number of recent
deals in the food industry.
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Durbin reported from Detroit.
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