CMA warns Unilever-McCormick deal may reduce competition in dry ingredients

Summarised from 3 outlets · Updated 11 Nov, 14:58 · Archive

The UK Competition and Markets Authority says the £33.8 billion merger could reduce competition in dry ingredient and sauce mixes.

The UK Competition and Markets Authority has raised concerns that Unilever's proposed £33.8 billion merger with American spice maker McCormick could harm competition in the UK grocery market. The deal, announced in March, would combine Unilever's food division, which owns brands including Knorr, Maille and Colman's, with McCormick's UK portfolio, which includes Schwartz and French's.

The CMA found that the merger would create the largest supplier of dry ingredient mixes for meals such as chilli con carne and dry sauce mixes such as parsley sauce in the UK market 'by far'. The watchdog identified competitors including seasoning brand Maggi and dry sauce brand Bisto, but concluded these products 'impose only a limited constraint' on the merged company.

The investigation examined potential competition concerns over mustard supplies to UK supermarkets, where Unilever owns Colman's and Maille while McCormick owns French's. However, the CMA found that consumers typically regard English, French and American mustards as distinct products, and supermarkets tend to stock each type separately. This limited overlap meant the watchdog identified 'no realistic prospect' of competition concerns over the condiment.

Unilever and McCormick have until next Wednesday to submit proposals addressing the CMA's concerns about reduced competition in some food products. If the regulator remains unsatisfied, the investigation will advance to the next stage.

How it is being reported

• CMA dials up probe into Unilever’s $65bn McCormick tie-upThe competition watchdog has escalated its probe into Unilever’s $65bn deal to offload its food arm to American spice giant McCormick, warning it could “substantially” weaken competition in the UK grocery market. In an update on Wednesday, the Competition and Markets Authority (CMA) said the mega-merger “gives rise to a realistic prospect of a substantial [...]City AM · 11 Nov, 11:13
• Unilever-McCormick deal may harm competition in dry ingredients market, says CMAUnilever has brands like Knorr, Maille and Colman’s as part of its food division, while McCormick’s owns Schwartz and French’s in the UK.Independent Business · 11 Nov, 08:19
• Unilever-McCormick deal may harm competition in dry ingredients market, says CMAUnilever has brands like Knorr, Maille and Colman’s as part of its food division, while McCormick’s owns Schwartz and French’s in the UK.Evening Standard · 11 Nov, 08:19

In this story: Unilever · McCormick · Competition and Markets Authority · United Kingdom

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