Unilever to Cut €1bn in Costs Following Food Division Spin-Off

✦ Meridian Analysis

Unilever has announced the sale of its slower‑growth food division, a transaction that is now in the announced stage and expected to close by mid‑2027, subject to customary closing conditions. Unilever will receive a cash payment of $15.7 billion on closing and its shareholders will receive a proportionate mix of McCormick voting and non‑voting shares equal to 65.0 % of the fully‑diluted combined company equity, valued at $29.1 billion. The deal values Unilever Foods at an enterprise value of approximately $44.8 billion, corresponding to an EV/Sales multiple of 3.6 × and an EV/EBITDA multiple of 13.8 ×. McCormick has secured a $15.7 billion bridge financing package from Citigroup Global Markets Inc., Goldman Sachs Bank USA and Morgan Stanley Senior Funding Inc. to fund the cash component. Goldman Sachs International and Morgan Stanley & Co. International plc are acting as financial advisors to Unilever; Citi and Rothschild & Co are acting as financial advisors to McCormick; Clifford Chance LLP and Wachtell Lipton Rosen & Katz are advising Unilever; Cleary Gottlieb Steen & Hamilton LLP and Hogan Lovells are advising McCormick. Unilever plans to cut €1bn in costs after completing the sale of its slower-growth food division. What remains undisclosed are any contingent consideration. Observers will also watch for the final regulatory sign‑off.

Additional sources: Unilever PLC | Financial Times · Unilever to cut €1bn in costs after food spin-off · Explainer: Why is Unilever hiving off its food business? | Reuters · Unilever, McCormick strike deal to create $65 billion food giant | Reuters · Unilever and McCormick agree to food business deal | Reuters

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