McCormick & Company Inc. has announced it has signed an agreement, subject to closing and regulatory approvals, with Grupo Herdez to acquire an additional 25 per cent ownership interest in McCormick de Mexico for $1.1 billion (US$750 million). The joint venture was established in 1947.
McCormick de Mexico is a long-standing food company with a portfolio that includes mayonnaise, spices, marmalades, mustard, hot sauce and tea, all sold under McCormick brands.
The acquisition will increase McCormick’s stake to 75 per cent and is expected to create opportunities for further development in the Mexican market. It also provides a platform for expansion into Latin America.
“This marks the beginning of an exciting new chapter for McCormick in Mexico. With this expanded ownership, we will advance our global flavour leadership and increase our presence in condiments and sauces,” said Brendan M. Foley, chairman, president, and chief executive officer.
Mexico is viewed by McCormick as an important emerging market, with changing demographics, evolving consumer habits and a strong culinary tradition. The deal will expand McCormick’s condiments and sauces portfolio, with their contribution to net sales projected to rise from 14 per cent to 22 per cent.
“The strength of the brand combined with McCormick’s global capabilities creates additional growth opportunities through category expansion, increased household penetration, and channel expansion in Mexico and across Latin America,” said Foley.