MCCORMICK & CO INC 8-K

What Happened

• On March 31, 2026, McCormick & Company, Incorporated announced definitive agreements with Unilever PLC and related parties to combine McCormick with Unilever’s foods business (Unilever Foods) through a distribution and two-step merger structure intended to qualify as a Reverse Morris Trust. The deal contemplates Unilever distributing SpinCo (the spun-off Unilever Foods) and merging SpinCo into McCormick subsidiaries so SpinCo shareholders receive McCormick voting and non‑voting common stock.
• The transaction documents include a Merger Agreement, a Separation and Distribution Agreement, and an Employee Matters Agreement, plus related agreements (stockholders’ agreement, transitional services, asset purchase, tax matters, IP/licenses, etc.). The merger structure and timing are subject to shareholder approvals, registration (Form S-4), antitrust and other regulatory approvals and certain reorganization steps.

Key Details

• Announcement date: March 31, 2026.
• Ownership at close (assuming DutchCo retains ~9.9%): Unilever shareholders ~55.1%, McCormick shareholders ~35.0%, DutchCo ~9.9% on a fully diluted basis. If Unilever elects full distribution of SpinCo, Unilever shareholders would own ~65% and McCormick shareholders ~35%.
• Financing: McCormick entered a Bridge Commitment Letter (March 31, 2026) for a senior unsecured 364‑day bridge facility up to $15.7 billion (commitment parties include Citi, Goldman Sachs Bank USA and Morgan Stanley). McCormick also intends to seek permanent unsecured notes/term loans before closing. Receipt of financing is not a condition to McCormick’s obligation to close.
• Corporate/governance items: After the First Merger McCormick’s board will be set at 12 members — 8 current directors and 4 designees of Unilever (one designee may be Unilever management). McCormick agreed to certain no‑shop/limited‑solicit covenants and to grant replacement awards to continuing Unilever Foods employees (with excess value cap borne by Unilever).
• Termination/fees: McCormick may pay a $420 million termination fee in specified circumstances (including if the McCormick Board withdraws its recommendation); McCormick may reimburse up to $75 million of Unilever’s transaction expenses if shareholders do not approve required actions.

Why It Matters

• This is a transformational, large-scale acquisition/combination for McCormick that would add Unilever’s foods business and significantly change ownership and board composition. The transaction includes a major near‑term financing backstop ($15.7B bridge) and multiple conditions (shareholder approvals, SEC registration, antitrust/other regulatory clearances) that investors should watch.
• Key near-term milestones for investors: shareholder votes on the share issuance and charter amendments, filing/effectiveness of McCormick’s Form S-4, any HSR/antitrust outcomes, and progress on permanent financing. The filing also highlights tax-structured options (Reverse Morris Trust vs. a potential taxable U.S. asset sale election by Unilever) that could affect the deal’s tax treatment.