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Get filing alertsMcCormick secures $2B term loan, reduces bridge facility for up to $15.7B Unilever foods acquisition
Filed May 1, 2026 · Period ending April 28, 2026 · ~1 min read
Key Changes
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McCormick entered a $2.0 billion term loan facility with Citibank to partially finance its pending acquisition of Unilever's foods business, with a three-year maturity from the merger closing date.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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The loan requires McCormick to maintain an EBITDA-to-interest-expense ratio of at least 3.75:1.00 each quarter after closing, restricting financial flexibility post-merger.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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McCormick reduced its bridge loan commitment from up to $15.7 billion to $13.7 billion by terminating $2.0 billion, replacing it with the term loan borrowings.
Item 8.01 — Other Events verify on EDGAR → -
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The term loan carries floating interest at Term SOFR plus 0.750%-1.500% or Base Rate plus 0.000%-0.500%, with rates tied to McCormick's credit ratings.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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A 0.10% annual ticking fee applies to undrawn commitments starting July 29, 2026, incentivizing McCormick to close the merger promptly.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR →
Summary
McCormick is executing its financing plan for the Unilever foods acquisition announced in March 2026. The company secured a $2.0 billion term loan facility with Citibank and simultaneously reduced its up to $15.7 billion bridge loan commitment by the same amount. This substitution replaces temporary bridge financing with a three-year term loan, a standard optimization as the deal approaches closing.
The bridge facility's up to $15.7 billion size signals the substantial cash component of this transaction. Retail holders should note the financial covenant requiring a 3.75:1.00 EBITDA-to-interest-expense ratio each quarter after closing. This constraint limits McCormick's financial flexibility post-merger and requires the combined company to generate sufficient earnings relative to its debt service.
The three-year maturity means McCormick will need to refinance or repay this debt relatively quickly, likely through permanent bond issuance or cash generation. The ticking fee starting July 29 creates a modest cost incentive to close promptly, though the 0.10% rate is immaterial compared to the transaction's scale.
Section-by-Section Diff
Event · Item 1.01 — Entry into a Material Definitive Agreement
Item 1.01 — Entry into a Material Definitive Agreement filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
On April 28, 2026, McCormick & Company, Incorporated, a Maryland corporation (“McCormick”), entered into a Term Loan Agreement (the “Term Loan Agreement”), by and among McCormick, the lenders party thereto and Citibank, N.A., as administrative agent (the “Administrative Agent”), in connection with the financing of McCormick’s pending combination with the foods business of Unilever PLC, a public limited company registered in England and Wales, (the “Merger”) pursuant to an Agreement and Plan of Merger dated as of March 31, 2026 (the “Merger Agreement”).
McCormick entered into a term loan agreement with Citibank as administrative agent to finance its acquisition of Unilever's foods business. The merger agreement was signed on March 31, 2026, and this loan facility provides the debt financing component for the transaction.
Added in current filing · verify on EDGAR →
The Term Loan Agreement provides McCormick with the ability to borrow up to $2.0 billion (the “Term Loan Facility”) at the closing of the Merger (such date, the “Closing Date”), subject to satisfaction of customary closing conditions for similar facilities, for the purpose of financing a portion of the cash consideration to be paid in the Merger and paying related fees and expenses in connection with the Merger and the other transactions contemplated by the Merger Agreement. The Term Loan Facility matures three years after the Closing Date.
The facility allows McCormick to borrow up to $2.0 billion at the merger closing to fund the cash consideration and related expenses. The loan has a three-year maturity from the closing date, indicating this is bridge financing that McCormick will need to refinance or repay relatively quickly.
Event · Item 8.01 — Other Events
Item 8.01 — Other Events filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
the Commitment Parties agreed, subject to the terms and conditions set forth therein, to provide a senior unsecured 364-day bridge term loan credit facility (the “Bridge Facility”) in an aggregate principal amount of up to $15.7 billion, for the purpose of financing all or a portion of the cash consideration and paying related fees and expenses in connection with the Merger and the other transactions contemplated by the Merger Agreement.
The bridge facility was established to fund the cash portion of McCormick's merger consideration and related transaction costs. The facility is senior unsecured with a 364-day term, providing short-term financing until permanent debt can be arranged. The $15.7 billion size indicates the scale of the cash component of the acquisition.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jul 3, 2026 · How we verify