McCormick has announced its plan to acquire an additional 25% interest in its Mexico joint venture, McCormick de Mexico, from Grupo Herdez for $750m.
The move will increase McCormick’s ownership to 75%, strengthening its growth in Mexico’s condiment sector, and plans to expand further in Latin America.
Established in 1947, as a joint venture with Grupo Herdez, McCormick de Mexico is a key player in the Mexican food industry, with annual net sales of around $810m.
The proposed transaction, pending regulatory approval, is projected to increase the company’s net sales and earnings in the first year.
McCormick de Mexico’s diverse product lineup, building on its mayonnaise brand, is expected to grow in the mid-single digits.
McCormick said the acquisition aligns with its growth strategy in Mexico and beyond.
McCormick chairman, president, and CEO Brendan Foley said: “We have had a long and successful partnership with Grupo Herdez, and we look forward to continuing our collaboration.
“With the expanded ownership of McCormick de Mexico, we plan to build upon their strong results by leveraging our combined expertise in category management, insight-driven innovation, as well as best-in-class marketing to expand in adjacent categories and increase channel penetration.
“Additionally, this transaction creates a strategic platform for scaling our operations and distribution across Latin America, consistent with the strategic plans we laid out at Investor Day.”
McCormick said the increased ownership in McCormick de Mexico is set to strengthen its portfolio, particularly in condiments and sauces.
The transaction is expected to elevate the segment’s contribution to McCormick’s net sales, enhancing its global market presence.
McCormick de Mexico’s strong sales growth and favourable margin profile will contribute positively to McCormick’s consolidated financials.
McCormick intends to fund the transaction, which is expected to be closed by early fiscal 2026, by a mix of cash and debt, with minimal impact on its leverage ratios.
Goldman Sachs is serving as the financial adviser, and Creel as legal counsel to McCormick in relation to the transaction.
Grupo Herdez chairman and CEO Héctor Hernández-Pons Torres said: “We are proud of the nearly 80 years of productive partnership we have built with McCormick, and this transaction marks an exciting evolution of our relationship.
“This milestone will enable the McCormick brand, with its rich heritage and diverse flavour portfolio, to reach even more consumers across Latin America.
“With McCormick’s extensive expertise in herbs and spices, condiments and sauces and global flavour leadership, we are excited to capitalise on new opportunities and achieve even greater success together.”
