McCormick Cooks Up Brand Investments As It Awaits Adding Unilever's Food Brands to the Menu
While McCormick is the dominant player in the $17.5 billion global spices and herbs market—with about a 17% share, nearly 4 times the next-largest branded operator (per Euromonitor)—it hasn't escaped macro and competitive challenges. We don't think the combination with Unilever's food brands (primarily Knorr cooking aids and Hellmann's mayonnaise) negates these headwinds. Instead, we think the massive deal, which stands to more than double McCormick's sales base to around $20 billion, brings significant integration risk. However, we're encouraged that Unilever intends to own around 10% of shares outstanding while maintaining board and executive leadership representation, which we think could facilitate a more seamless combination.
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