Business alert: Colman's Mustard for sale as owner eyes £48billion deal with Unilever

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Unilever is offloading Colman's Mustard from its brand portfolio

An iconic British supermarket brand is being put up for sale as its owner eyes a £48billion deal with a foreign company.

Colman’s Mustard is being floated on the market ahead of a merger between its British owner and an American mustard giant.

Rothschild bankers have been appointed to oversee the sale after Unilever decided to offload the iconic condiment brand to avoid regulatory obstacles threatening its planned merger with American spice giant McCormick.

The Ftse100 company is spinning off its food division into a combined entity with McCormick, but advisers concluded that proceeding with Colman's in the package would risk creating a mustard monopoly alongside McCormick's existing French's Mustard brand.

The remainder of Unilever's food portfolio, including Marmite, is still expected to transfer to McCormick as originally planned.

Unilever's advisers had grown concerned that combining the two businesses without divesting Colman's would hand regulators clear grounds to block the transaction, given McCormick already owns French's Mustard.

Both the UK Competition and Markets Authority (CMA) and the US Federal Trade Commission (FTC) are expected to examine the deal closely for anti-competitive effects.

Businesses confronting monopoly worries are routinely compelled to divest certain operations to satisfy regulatory demands.

The broader merger would bring together Unilever's food arm with McCormick to form a £48billion powerhouse. Brands such as Marmite and other major Unilever food labels remain part of that planned combination.

By proactively removing Colman's from the equation, Unilever hopes to smooth the path for approval on both sides of the Atlantic.

Colman's traces its origins to 1814, when Jeremiah Colman, a flour miller, started grinding mustard seed at a watermill in Bawburgh, Norfolk.

A subsequent member of the Colman family later introduced the brand's distinctive bull's head logo, chosen to represent both the mustard's fiery potency and its natural affinity with British beef.

Queen Victoria granted the company a Royal Warrant in 1866. Before Unilever purchased the brand in 2005, it sat within the portfolio of Reckitt and Colman, once a major force in British consumer goods.

The mustard also enjoys a longstanding association with Norwich City FC, whose canary yellow kit mirrors the brand's signature colour scheme. Colman's served as the club's shirt sponsor during the 1990s.

Analysts had criticised the prospect of the brand passing to a US conglomerate, describing it as a "shame" that such storied names were being lost to American corporate hands. Throughout its 212-year existence, Colman's has never been owned outside Britain.

A Unilever spokesman confirmed the move: "A decision has been taken to market the Colman's brand and assets to potential buyers in order to proactively seek to address potential competition concerns from the planned combination of Unilever Foods and McCormick."