LONDON, April 6, 2026, 13:20 BST
Unilever’s U.S. shares traded at $55.45 before the bell on Monday, down around 60 cents from the prior close as of 11:08 UTC. Investors continued to weigh last week’s move to merge its food business with McCormick. If completed, the British company would sharpen its focus on beauty, personal care, and home care.
This isn’t just about McCormick. The company’s almost $45 billion offer for Unilever’s food business stood out as one of the largest consumer deals of the first quarter, highlighting the push for size as sales growth softens and shoppers switch things up. For Unilever, it effectively closes a chapter on nearly 100 years in food under its own banner.
Unilever and its shareholders are set to end up with 65% of the merged entity, while Unilever itself will pocket $15.7 billion in cash under the agreement. That cash, the group noted, is earmarked for separation and tax costs, reducing debt, and fueling buybacks worth around 6 billion euros between 2026 and 2029. The deal takes the form of a Reverse Morris Trust—a U.S. spin-off merger designed with tax efficiency in mind. Completion is targeted for mid-2027.
Chief executive Fernando Fernandez is pitching the deal as the strongest proof yet of his push to streamline the business. Calling it “the right step at the right time,” he told analysts the reshaped company would become a 39-billion-euro player in household and personal care, with greater reach in the U.S. and India. Unilever, according to Reuters, has been trading at a lower forward earnings multiple compared to single-focus rivals like L’Oréal and Procter & Gamble. Reuters
There are investors who agree. David Samra, managing director at Artisan Partners, believes splitting off food from personal care makes sense, and he thinks what’s left should trade at a richer earnings multiple. “More logically separate” is how he put it. Reuters
The market’s initial response? Pretty unforgiving, with skepticism hanging in the air for some shareholders. Chris Beckett at Quilter Cheviot noted, “the market, so far, has not reacted well,” citing both regulatory cloudiness and the tricky task ahead in merging such a sizable food operation. RBC analysts didn’t mince words either, labeling the setup “hardly a clean exit”—most of the new food giant will still be in Unilever shareholders’ hands. Reuters
McCormick’s approach: focus on flavor, not just pushing more product. Chief executive Brendan Foley put it bluntly—the company plans to “continue to flavor calories while others compete for them.” His pitch: people eating healthier and cooking at home will keep reaching for sauces, seasonings, and condiments. But this comes as GLP-1 weight-loss drugs, which suppress appetite, are already shaking up the market. Reuters
Still, risks remain. Regulatory sign-off is pending, and completion isn’t likely before mid-2027. Unilever’s European works council flagged possible union pushback if staff protections fall short. After the disposal news, S&P Global Ratings kept Unilever at A+/A-1 but shifted its outlook to negative.
