Unilever is in advanced talks to sell its food business to spice maker McCormick for a deal valued in the tens of billions of dollars, according to the Financial Times. This potential sale would mark a decisive shift for the FTSE 100 consumer goods giant, accelerating its strategic retreat from slower-growth food brands to focus on its faster-expanding beauty and personal care divisions. The company confirmed discussions with McCormick after receiving an offer for the business, which includes iconic brands like Marmite, Hellmann's mayonnaise, and Pot Noodle.

Unilever emphasized there is no certainty the transaction will finalize, though analysts estimate the standalone food division's value at $36-$37 billion. The deal would represent a transformative restructuring, completing Unilever's decade-long divestment from food categories like spreads, tea, and ice cream. McCormick, with $7 billion in annual revenues and a market cap exceeding $14 billion, is known for brands like French's mustard and Cholula hot sauce. Bernstein analyst Callum Elliott suggests the transaction could mirror a Reverse Morris Trust structure, allowing Unilever to spin off the unit tax-efficiently while retaining majority ownership of the merged entity.

The strategic alignment between Unilever's Hellmann's mayonnaise and McCormick's sauce portfolio appears compelling, though the final terms remain under negotiation. This development follows earlier reports of preliminary talks between Unilever and Kraft Heinz regarding a potential merger of their food businesses.