The UK regulator is seeking remedies from Unilever and McCormick & Co. to allay concerns a merger would lead to a “substantial lessening of competition”.
In its Phase 1 decision published today (11 November), the Competition and Markets Authority (CMA) said McCormick’s $44.8bn acquisition of most of Unilever's global food assets gives rise to a "realistic prospect" of SLC arising in the UK.
The concerns centre on the supply of dry ingredient mixes and, separately, dry sauces to retailers.
Both companies now have until 18 November to offer remedies, formally known as undertakings in lieu of reference (UIL), to address the regulator's findings.
If no suitable remedies are proposed, or if the CMA deems them “insufficient”, the watchdog will refer the transaction for a more in-depth Phase 2 investigation.
The deal, announced in March, will see US-headquartered seasonings and spices maker McCormick take over most of the FMCG giant’s food business, including the Knorr and Hellmann’s brands.
Following the initial review, the watchdog concluded that the deal would combine the “two largest branded suppliers” of dry cooking ingredient mixes, such as chilli con carne, and dry pour-over sauces, like parsley sauce, in the UK.
McCormick sells dry mixes and sauces under the Schwartz brand in the UK, while Unilever Foods offers products under brands including Knorr.
CMA said that the merged entity would become the largest supplier in both categories "by far".
It added that private label and branded rivals, including the Nestlé-owned Maggi line in dry ingredient mixes and Premier Foods' Bisto brand in dry sauces, would impose "only a limited constraint" on the combined group.
The regulator did not expect new competitors to fill the gap.
However, the CMA cleared the deal with respect to mustard, finding "no realistic prospect of competition concerns" in the category.
McCormick supplies American-style mustard under the French's brand, while Unilever produces Colman's English mustard and a French variant Maille.
Based on evidence from major supermarkets, the CMA determined that shoppers generally do not view English, French and American mustards as “suitable alternatives to one another”.
The mustard clearance comes after Unilever and McCormick announced in August they were seeking a buyer for Colman’s “to proactively seek to address potential competition concerns”.
Apart from Colman’s, the merger deal excludes Lipton drinks, Unilever’s lifestyle nutrition business, its Buavita unit, and operations in India, Nepal and Portugal.
The CMA said it holds jurisdiction to review the combination because the UK turnover of both McCormick and Unilever Foods exceeds £100m ($132.6m).
The transaction remains conditional on merger clearance from competition authorities including the CMA.
If the deal goes ahead, the combined group will be led by McCormick CEO Brendan Foley and CFO Marcos Gabriel.
Unilever shareholders will hold 55.1% of the enlarged entity, McCormick investors 35%, and Unilever 9.9%.
The CMA’s decision comes just weeks after Unilever’s planned divestment of the Unox brand to Zwanenberg was blocked by the Dutch anti-trust regulator. The Netherlands Authority for Consumers and Markets (ACM) concluded that the deal would make Zwanenberg the “only major supplier” of smoked and boiled sausages to Dutch supermarkets.
Unilever Foods generated €3.1bn ($3.4bn) in turnover in the third quarter of 2026, with underlying sales growth (USG) of 0.1%.
Last year, the division generated €12.9bn in turnover, with USG of 2.5%, accounting for roughly 26% of the group’s total group turnover.
Meanwhile, McCormick reported a 2% rise in net sales to $6.84bn for the fiscal year ended on 30 November 2025.
