Unilever Nigeria Plc has confirmed that its parent company, Unilever Plc, is moving to merge its global food business with McCormick & Company in a major deal valued at $44.8 billion.
In a statement filed with the Nigerian Exchange (NGX) on Wednesday, Unilever Nigeria said it is currently reviewing how the proposed transaction could affect its operations and structure. The statement was signed by company secretary, Peter Dada.
According to the disclosure, the deal remains subject to regulatory approvals and other conditions before it can be finalised.
“Unilever Plc (the parent company), officially announced on March 31, 2026, that it has entered into an agreement to combine its global foods business with McCormick & Company, Inc., subject to required regulatory approvals and the satisfaction of other customary closing conditions,” the statement reads.
“This global transaction is expected to create a new combined group specialising in flavours and food products.
“At this stage, the Company is evaluating the specific implications of this global transaction on its local operations and corporate structure.”
The company added that it will provide further updates on timelines and operational changes once it receives more details from its parent company.
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Analysts say the proposed merger could significantly influence earnings, as the food segment contributes a major share of revenue for both Unilever Plc and its Nigerian subsidiary.
Unilever Plc operates across four key segments—beauty & wellbeing, personal care, home care, and foods—while Unilever Nigeria’s revenue is largely driven by its foods and personal care divisions.
Unilever Plc reported strong revenue performance in its food division, while in Nigeria, the food segment remains its top revenue driver.
DETAILS OF THE DEAL
According to Unilever Plc, the transaction is valued at $44.8 billion and will involve both shares and cash components.
“In this Transaction, Unilever and Unilever shareholders will receive a proportionate mix of McCormick’s existing voting and non-voting common stock, equating to 65.0% of the fully diluted combined company equity, equivalent to $29.1 billion[c] based on the last 1-month volume-weighted average McCormick share price of $57.84[c],” the statement noted.
“Unilever will also receive $15.7 billion in cash, subject to certain closing adjustments, that will offset one-off separation and tax costs; pay down debt to its current level of c.2.0x net debt to EBITDA following closing; and support €6 billion of share buy-backs expected to run between 2026 and 2029.
“The Transaction reflects an enterprise value of $44.8 billion for Unilever Foods.”
The company further explained that its stake in McCormick will be gradually reduced after the deal is completed.
“Unilever shareholders will own 55.1% of the fully diluted combined company equity. Unilever will own a 9.9% stake, underscoring its support and confidence in the strategic merits, integration plan and execution of the combined company,” it said.
“Over time, and not earlier than one year after closing, Unilever intends to sell down its stake in an orderly and considered manner. McCormick shareholders will own 35.0% of the fully diluted combined company equity.”
The merger is expected to be executed as a tax-efficient “Reverse Morris Trust” structure, designed to minimise tax obligations for shareholders.
Unilever Plc added that the deal is expected to be completed by mid-2027, pending regulatory approvals and shareholder consent.