McCormick acquires Drogheria & Alimentari for $97mn

MCCORMICK & Company, Incorporated (NYSE: MKC) agrees to buy 100% of the shares of Drogheria & Alimentari (D&A), a maker of spices and seasonings in Italy.

The global leader in flavour will acquire the privately held company for €85 million (US$97 million), which consists of a cash payment of €50 million and a potential earn out payment in 2018 of up to €35 million based upon the performance of the business. 

Founded in Florence in 1880, D&A has annual sales of €50 million (US$57 million), with the home market accounting for 80%.

According to McCormick, it will work with the current owners of the business and to grow sales of D&A products at a mid-single digit rate. 

“We are pleased to expand our portfolio of leading brands around the world with the addition of Drogheria & Alimentari,” said Alan Wilson, chairman & CEO of McCormick. “As a supplier of both brand and private label products, D&A has approximately one third of the spice and seasoning category in Italy and exports its products to 60 other countries.  We anticipate strong growth for these premium products, particularly in the US and key international markets where consumers are seeking unique and authentic ethnic flavors. The owners and employees of D&A have built a great business and we look forward to working with them to achieve continued success." 

Malcolm Swift, president of McCormick Europe, Middle East and Africa (EMEA) said, “This acquisition complements McCormick's strong brands across EMEA and expands McCormick's current spice and seasoning leadership in Europe with a sizable footprint in Italy.  In addition, there is a strong fit between McCormick, a recognised flavor leader in the region, and Drogheria & Alimentari, which has a reputation for high quality products and professionalism."

The completion of the agreement is expected to occur in May 2015, subject to regulatory approval.