Barclays keeps an Equal Weight rating on McCormick (MKC) with a $67 price target after the company confirmed discussions with Unilever (UL) regarding a potential strategic transaction involving Unilever’s Foods business. The firm acknowledges the “significant strategic merit and likely compelling earnings accretion for McCormick from a potential transaction. However, the deal vale would like be “hefty” and come with execution risk, the analyst tells investors in a research note. Barclays adds that the resultant majority ownership of the combined entity by Unilever shareholders “could dampen initial investor enthusiasm.” McCormick shares are up 31c to $54.36 in premarket trading.
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Read More on MKC:
- McCormick price target lowered to $59 from $67 at UBS
- McCormick confirms discussions with Unilever regarding food business
- Unilever Considers Major Food Spinoff as McCormick Merger Talks Surface
- Unilever in talks to separate food business, combine it with McCormick, WSJ says
- McCormick up 2.5% at $55.38 after WSJ report on potential combination