McCormick–Unilever deal faces UK competition concerns in dry sauces
The UK competition regulator raised concerns about McCormick’s planned acquisition of most of Unilever’s food business. It found a realistic prospect of substantially reduced competition in dry ingredient mixes and dry sauces supplied to retailers. The companies have until 18 November to propose remedies before a possible in-depth investigation.
Economics & Markets··Morning
Dry mixes and sauces draw scrutiny
The UK competition regulator raised concerns about McCormick’s planned acquisition of Unilever’s food business.[1], [2]
The UK Competition and Markets Authority raised competition concerns over McCormick’s proposed purchase of substantially all of Unilever’s global food business. Its phase-one decision summary, published on 11 November, identified a realistic prospect of substantially lessened competition in dry ingredient mixes and dry sauces sold to UK retailers. The transaction would combine the two largest branded suppliers in these categories.[1]
Established brands face limited rivals
McCormick supplies dry mixes and sauces under Schwartz, while Unilever Foods includes Knorr and Colman’s. The regulator considered competition from private-label goods and brands including Maggi and Bisto to be limited in the affected markets. Restricted supermarket shelf space and established suppliers’ positions made entry or expansion difficult. Mustard styles were treated as separate product markets, with no corresponding competition concern identified there.[1]
Remedies are due by 18 November
The companies have until 18 November to offer undertakings addressing the concerns. If they offer none, or if their proposals fail to meet the phase-one standard, the regulator will refer the deal for an in-depth phase-two investigation. Completion remains conditional on relevant merger approvals. Some food businesses would remain with Unilever, which would receive McCormick shares and rights to appoint board members under the agreement.[1]
