LONDON, March 21, 2026, 19:05 GMT
Unilever PLC finished Friday’s session up 0.47% at 4,595.5 pence, following word that it’s fielding an inbound offer for its Foods division and holding discussions with McCormick & Co. That was enough to lift the shares, which had been under pressure amid a swirl of spin-off chatter and deal rumors this week.
Foods remains a big chunk of Unilever—the division posted €12.9 billion in sales last year, accounting for over 25% of total revenue. But with growth at only 2.5%, the unit lagged not only behind Unilever’s 4% to 6% target but also trailed the company’s other segments.
Chief Executive Fernando Fernandez has steered Unilever’s focus toward higher-growth beauty, household, and personal care brands since spinning off the ice cream division last year. Shares clawed back some ground Friday, but that bounce barely dented losses from earlier in the week, as investors got jittery over the risk that management could get bogged down by another major split.
Unilever’s board called Foods “highly attractive” but cautioned that a deal isn’t guaranteed. This follows word that discussions with Kraft Heinz about a possible food partnership have wrapped up. Unilever
Barclays estimates the food division somewhere between 28 billion and 31 billion euros—far bigger than McCormick’s market cap, which sits near $14.5 billion. Analysts persistently flag a Reverse Morris Trust as the likely solution here: spin off the unit, merge it with a purchaser, and do it all in a tax-friendly way.
TD Cowen’s Robert Moskow pointed to “strong strategic logic” behind the deal, suggesting it could push McCormick further with retailers and broaden its global footprint. Over at GlobalData, Neil Saunders described McCormick as a “natural fit” for the move, but flagged questions about the company’s ability to generate solid returns given the sluggish food market. Reuters
Richard Saldanha, portfolio manager at Aviva, called it sensible for Unilever to rethink its slower-growth food business, given the stronger growth prospects in beauty and personal care. Chris Beckett at Quilter Cheviot pointed out that the real challenge will be landing on a structure that delivers a premium for Unilever shareholders without shortchanging McCormick investors.
Shifts among rivals are under way. Kraft Heinz was once in the running, but those discussions fell through. A tie-up with McCormick, on the other hand, would see Hellmann’s and Knorr joining forces with Cholula, French’s, and Frank’s RedHot, creating a far larger player in condiments and cooking aids.
But the downside risk is hard to ignore. Foods faces mounting strain from lower-priced supermarket own-label competition and appetite-suppressing GLP-1 weight-loss drugs. A split would also mean Unilever has to unravel supply chains and distribution networks it’s spent decades putting together.
According to Davis Householder at MycoManagement, the real challenge isn’t just lining up the money—it’s carving out a global food business while keeping operations on track. Investors, at this point, are left with word of ongoing discussions but nothing formalized, and Unilever’s shares continue to reflect that uncertainty.
