• Unilever Nigeria hit a decade-high profit in 2025, with its net income doubling to reach $21.2 million, or 214.3 billion naira

• Nearly 60% of the revenue driving this record financial performance was generated by just two core food brands: Knorr and Royco

• Paradoxically, the London parent company just agreed on March 31 to sell this highly profitable portfolio to McCormick for $45 billion

Unilever Nigeria Plc, the Lagos-listed subsidiary of the British consumer goods group that has operated in Nigeria for over a century, reported revenue of $140.7 million in 2025, up 43% from the previous year. Net profit reached $21.2 million, more than double the $9.9 million recorded in 2024, according to audited financial statements filed with the Nigerian Exchange on March 18. All dollar figures are based on an average 2025 exchange rate of 1,522 naira to the dollar.

The Foods segment, which includes Knorr seasoning cubes and Royco, two widely used kitchen staples in Nigeria, generated $83.9 million in revenue, accounting for 59.6% of total turnover.

This same division is at the center of a $45 billion deal announced Tuesday, under which Unilever Plc plans to spin off its global food business and merge it with McCormick & Company, a U.S.-based spice maker known for brands such as Cholula hot sauce and French’s mustard, the companies said in a joint statement.

“Our strong full-year performance reflects a business that is sharper, faster and built to win ,” said Tobi Adeniyi, managing director of Unilever Nigeria, in a statement accompanying the results.

He cited Knorr and Rexona as “power brands” driving growth but did not comment on the potential impact of the planned global food divestiture on Nigerian operations.

The timing is significant. Unilever Nigeria is reporting its strongest results just as its parent company restructures in a way that could separate its main revenue driver from the rest of the business.

It remains unclear whether the Nigerian unit will ultimately be transferred to McCormick, listed separately, or maintain links with Unilever’s remaining beauty and personal care operations. That uncertainty is now weighing on the stock.

Portfolio stakes

The deal is structured as a Reverse Morris Trust, a mechanism used to reduce tax exposure. It would give Unilever and its shareholders a combined 65% stake in the new entity formed by merging the Foods division with McCormick. Unilever would also receive $15.7 billion in cash, the companies said in a joint statement.

Barclays analyst Warren Ackerman estimated the enterprise value of Unilever’s food business at about $33 billion, based on operating profit of $3.1 billion last year, according to Reuters. Rothschild, which acted as joint lead financial adviser to McCormick, said this is the largest reverse Morris trust involving a European company.

For the Nigerian subsidiary, the split raises immediate operational questions. The food division relies on local manufacturing, a distribution network built over more than 100 years with over 80 partner distributors from Lagos to Borno State, and strong consumer recognition for brands such as Knorr and Royco, which would be difficult for a new owner to replicate quickly.

The company sourced more than 60% of its raw materials locally in 2025, according to its annual report. This long-established supply chain is a key advantage that may not easily transfer to a new parent with no prior presence in Africa.

The broader financial picture adds another layer. Unilever Nigeria’s non-operating income rose sharply to $6.6 million in 2025 from $700,000 in 2024. This increase was driven by returns on its $72.8 million cash holdings invested in Nigerian money-market instruments, at a time when the Central Bank of Nigeria maintained its benchmark rate near 27.5%.

Excluding this income, which depends on prevailing monetary conditions, the company’s underlying operating performance appears significantly different.

Unilever has spent the past five years divesting non-core food assets, including snack brand Graze, plant-based meat label The Vegetarian Butcher, and its Russian operations, while also spinning off its ice cream business in 2025.

The McCormick transaction accelerates this strategy and would further reduce the group’s exposure to food. Beauty & Wellbeing and Personal Care divisions, which include brands such as Vaseline and Dove, grew at mid-single-digit rates globally in 2025, while the Foods segment remained flat, according to Unilever’s full-year results filed with the SEC.

The share prices of both companies reflected investor caution on Tuesday. Unilever’s London-listed stock fell 4% and McCormick’s Nasdaq-listed shares dropped 6% in morning trading, according to CNBC, as markets assessed the complexity of merging two large food businesses across different continents and ownership structures.

In Lagos, where Unilever Nigeria’s shares had already more than doubled in 2025 to close at $0.047 on December 31, the deal introduces a new layer of uncertainty that analysts will need to factor in. The company’s first-quarter 2026 trading statement will be the next opportunity for management to clarify the implications of the global restructuring for the listed subsidiary.

Idriss Linge