Unilever's shares plunged 24% on Tuesday, erasing $42 billion in market value, after the company agreed to combine its food unit with McCormick & Co. The deal, expected to close next year, has transformed the stock from a defensive bellwether into a source of significant investor concern. While the transaction aims to recast Unilever as a leader in beauty, personal and home care, immediate shareholder benefits remain unclear. Analysts warn of deal complexity and potential reluctance to own a highly leveraged US-listed food entity. McCormick’s recipe for value creation will need time to cook, noted TD Cowen’s Robert Moskow. The stock has now fallen 24%, wiping out $42 billion from its peak value since February.

S&P Global Ratings cut its outlook to negative, citing lower scale and diversity post-deal and a more challenging industry environment. Unilever investors will receive shares in the new combined company, raising questions about exposure to debt and New York listing risks. The market reaction appears overdone, Barclays’ Warren Ackerman argued, though analysts broadly agree the stock is overvalued at current levels.