Britain’s competition watchdog has told Unilever and McCormick they must address concerns about their planned $65 billion food deal or face a full investigation, putting one of the largest food transactions in history under fresh pressure.
The Competition and Markets Authority said on Wednesday that combining Unilever’s food business with the US spice maker could weaken competition in the supply of dry ingredient mixes and dry sauces to British retailers. The companies have until 18 November to offer remedies, or the regulator will refer the deal to an in-depth phase-two inquiry, which can clear it, clear it subject to conditions such as asset sales, or block it outright.
Unilever announced in March that it would merge its food business with McCormick, the maker of Frank’s RedHot sauce and French’s mustard, in a deal worth around $65 billion — the second-largest food sector transaction on record. McCormick’s UK consumer business sells herbs, spices and sauces under the Schwartz brand, while Unilever sells dry sauces and meal mixes under Knorr, Maille and Colman’s.
The CMA’s concern centres on dry ingredient mixes, such as chilli con carne mixes, and dry sauces, such as parsley sauce. It said Nestle’s Maggi, Premier Foods’ Bisto and supermarket own-brands provide only limited competition in those markets, leaving shoppers with few alternatives if the combined group raised prices or cut ranges.
Mustard, however, escaped scrutiny. The regulator found that English, French and American-style mustards are separate markets because shoppers do not see them as close substitutes, so it raised no concerns about combining McCormick’s French’s brand with Unilever’s Colman’s and Maille mustards. Unilever said it had already decided to sell Colman’s, which also makes mint sauce and recipe mixes, to address potential concerns proactively, and that talks with buyers were progressing well — though analysts now question whether that sale will still happen.
“The reason Unilever was looking at selling Colman’s was always for antitrust reasons, so now that it isn’t an area of concern for the CMA, it probably doesn’t get sold,” said Quilter Cheviot analyst Chris Beckett, who suggested McCormick’s Schwartz products in the UK could instead form part of a remedy package.
Both companies said they were working constructively with the regulator. “This is an expected step in the regulatory process, and we are working constructively with the CMA on a suitable remedy,” a Unilever spokesperson said. McCormick said it continued to make good progress on regulatory approvals globally and remained confident of a timely closing. The deal has already cleared a key US hurdle, winning approval under the Hart-Scott-Rodino Act on 5 October.
The deal is central to Unilever chief executive Fernando Fernandez’s reshaping of the group around faster-growing personal care and beauty businesses; it spun off its ice cream division last year. Unilever’s shares were little changed after the CMA’s announcement, while McCormick’s were down 2.1% in afternoon trading in New York.
Separately on Wednesday, the CMA raised concerns about Dulux paint maker AkzoNobel’s proposed $25 billion merger with US rival Axalta in the UK vehicle refinish coatings market, giving those companies a week to offer remedies or face a deeper investigation.
Sources: Reuters — https://www.reuters.com/business/retail-consumer/unilever-mccormick-food-deal-may-weaken-uk-competition-watchdog-says-2026-11-11/
