Shares of McCormick & Company, Incorporated (MKC) dropped over 5% on Tuesday morning after the company announced a deal to combine with Unilever's Foods business.
The stock is currently trading at $50.56, down $3.16 or 5.88%, on the NYSE. It opened at $50.27 after closing the previous session at $53.72. The stock has traded between $48.31 and $83.15 over the past 52 weeks.
McCormick said it will combine with Unilever's Foods business (excluding certain regions) in a deal valuing the unit at approximately $44.8 billion, creating a global flavor-focused company with about $20 billion in annual revenue.
Under the terms, Unilever and its shareholders will receive a mix of cash and equity, ultimately holding a majority stake in the combined company.
The transaction is expected to be accretive to revenue growth, margins, and adjusted EPS in the first full year, with projected cost synergies of $600 million annually by year three.
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