Just In: McCormick To Acquire Additional 25% Ownership In Mexico Joint Venture

McCormick & Co. (MKC) announced on Thursday that it has signed a definitive agreement with Grupo Herdez to acquire an additional 25% ownership interest in McCormick de Mexico for $750 million. 

McCormick de Mexico is a joint venture formed in 1947 between McCormick and Grupo Herdez. The company said the acquisition will increase McCormick's ownership to 75%, creating opportunities for further growth in the Mexican market. 

Retail sentiment on McCormick improved to ‘bullish’ from ‘neutral’ a day ago, with chatter levels at ‘normal’ levels, according to data from Stocktwits.

The transaction provides a strategic platform for further expansion in Latin America, McCormick said. The firm highlighted that McCormick de Mexico is a food company in Mexico, with a broad portfolio, including mayonnaise, spices, mustard, hot sauce, and tea, sold under McCormick brands. "With this expanded ownership, we will advance our global flavor leadership and increase our presence in condiments and sauces," said McCormick’s CEO, Brendan M. Foley.

McCormick de Mexico's annual net sales amount to about $810 million and are expected to grow in the mid-single digits range. The company’s product portfolio consists primarily of Mayonnaise, one of its flagship products. 

The transaction will expand the global condiments and sauces portfolio of McCormick, increasing its contribution to net sales from 14% to 22%, following the close, the company said.

McCormick said the transaction is expected to be accretive to adjusted earnings per share in the first year. The company added that the deal represents an acquisition multiple of about 12 times 2025 earnings before interest, taxes, depreciation, and amortization (EBITDA) and annual recurring management fees.

The deal is expected to be completed early in fiscal 2026. McCormick’s stock has declined 8.3% this year and has fallen 11.3% in the last 12 months. 

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