The all-cash deal, which values the sauce business at 3.6 times its annual sales, boosts the Japanese condiments maker's presence in North America's grocery aisles as declining birth rates and an ageing society stifle growth at home.

The companies announced the deal on Thursday after Reuters reported late on Wednesday that the parties were in advanced talks, nearly a month after Unilever said it was weighing options for the sauces business and for its struggling Slim-Fast brand.

The sale of those operations, plus the recent disposals of Skippy peanut butter and Wishbone salad dressings, will complete the restructuring of Unilever's North American portfolio, the company said, as the group sharpens its focus on its most profitable products.

Unilever, which still owns food brands such as Ben & Jerry's ice cream, Knorr soups and Hellman's mayonnaise, also has margarine and spreads brands in its portfolio, including Flora and Becel. These, however, have been hurt by a shift in consumer tastes away from chemical ingredients, leading some analysts to suggest that they, too, could be sold.

PERISHABLE ASSETS?

Deutsche Bank analyst Harold Thompson said he expects Unilever to continue to make modest food disposals, though he did not name specific brands.

"The key is for the dilution of this disposal strategy to be offset by the enhancement of acquisitions in (home and personal care) markets for it to be a success over the long term," Thompson said.

Unilever has been vocal about its desire to focus more on personal care brands, which enjoy higher margins and growth in emerging markets.

"Food is in the doldrums in mature markets," one consumer analyst said.

Thursday's deal also marks another step in the simplification of Unilever, with the company created by the 1929 merger of English soap company Lever Brothers and Dutch margarine company Margarine Unie saying this week that it was buying out the rights of its co-founder's family trusts.

LOOKING WEST

For Mizkan and rival asian groups, however, the deal steps up a shift towards Western markets, spurred by slowing domestic growth and cash-heavy balance sheets.

Mizkan already had Britain's Branston Pickle and Sarson's vinegar in its growing larder and fellow Japanese group Suntory Holdings [SUNTH.UL] closed a $16 billion takeover of U.S. bourbon company Beam Inc last month, following last year's agreement by Suntory Beverage & Food to buy UK drinks Lucozade and Ribena from GlaxoSmithKline.

But it's not only the Japanese that are hungry for more.

Emperador Inc of the Philippines agreed this month to buy Scotch whisky company Whyte & Mackay from United Spirits, and China's Bright Food Group [SHMNGA.UL] said on Thursday that it would buy control of Tnuva, Israel's largest food company, from private equity firm Apax [APAX.UL].

Mizkan, which says it is the world's leading provider of rice wine vinegar, already owns U.S. cooking wine brand Holland House and Border Foods, which makes Mexican sauces and peppers.

The pasta sauce business gives it additional annual turnover of more than $600 million and the leading brand in a market with annual sales of $2.3 billion.

Goldman Sachs acted as financial adviser to Mizkan, with Shearman & Sterling LLP and Mori Hamada & Matsumoto serving as legal advisers. Unilever was advised by Morgan Stanley and law firm Cravath Swaine & Moore LLP.

The deal is expected to close by the end of June and is being financed by the proceeds of a new fully committed financing facility.

Unilever shares slipped 0.7 pct to 26.75 pounds by 1439 BST.

(Additional reporting by Soyoung Kim in New York; Editing by David Goodman)

By Martinne Geller and Paul Sandle