$45 billion deal: Unilever's food division to merge with McCormick

US spice maker McCormick is buying the food business of Anglo-Dutch company Unilever (a division of Unilever Foods), including the Hellmann's mayonnaise brand, according to a release on the company's website - thus bringing a new major player to the food market.

The deal values the Unilever unit at $44.8 billion, reflecting the value of Unilever Foods and McCormick's valuation of about $21 billion, the company said in a statement. Unilever securities are adding 0.52% in the U.S. premarket, while McCormick shares are up 0.89%.

Unilever will take control of the combined condiments and sauces company. Under the deal, McCormick will pay the Anglo-Dutch company $15.7 billion in cash and McCormick shares equivalent to $29.1 billion. As a result, Unilever and its shareholders will receive 65% of the combined entity, which will include McCormick brands - including French's mustard.

The deal will be accomplished through what is known as a Reverse Morris Trust, a type of merger that is designed to exempt the company from taxation.

The agreement is the largest in the history of both companies, Bloomberg writes - it is expected to help redefine Unilever's image as a global leader in cosmetics, personal care and household products. And McCormick - will turn into a larger player in the global food market.

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