economy
Unilever’s food mashup is hardly a delectable prospect for shareholders
This ‘growth-led separation’ is an awkward, sprawling deal, far from the clean break some may have wished for
TL;DR
- Unilever is selling its food division to McCormick in a $44.8bn deal that involves cash and an equity swap.
- Unilever shareholders will own 55% of the expanded McCormick, with Unilever itself holding 10%.
- This deal is presented as a "growth-led separation" and a "sharpening of the portfolio" but is seen as messy compared to previous exits.
- Unilever's food business is larger, has faster sales growth, and superior profit margins compared to McCormick's.
- Unilever's share price dropped 7% following the announcement of the deal.
- The combined food business will operate under McCormick's management.