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McCormick Expands Flavor Leadership in Mexico with $750 Million Investment
Key Points:
- McCormick & Co. acquires majority ownership of joint venture in Mexico with $750 million investment.
- Company increases stake in McCormick de Mexico to 75% by purchasing additional 25% from Grupo Herdez.
- Strong demand for mayonnaise in Mexico drives expansion opportunities for condiments business in Latin America.
Insight into the Investment
McCormick’s CEO Brendan Foley views the transaction as a strategic move to elevate mayonnaise as a core component of the company’s portfolio. The acquisition solidifies McCormick’s position as a leading mayonnaise brand in Mexico, known for its unique lime-infused mayonesa.
Mayonnaise, a $14 billion industry and the world’s second-largest condiment category, is experiencing rapid growth in Mexico, presenting new avenues for McCormick to expand its market presence.
Foley emphasized the potential for category expansion and growth opportunities in Latin America, citing the company’s successful track record, brand power, and global capabilities.
Expanding Horizons in Latin America
While the focus is on Mexico, the transaction with Grupo Herdez paves the way for McCormick to venture into other Latin American countries. The company has already established a strong presence in Central America, with recent investments in product innovation and distribution expansion in countries like Guatemala and Costa Rica.
With the surge in demand for spices, sauces, and condiments due to the rise in home cooking, McCormick reported a 2% increase in sales for the second quarter, underscoring the company’s resilience and growth potential in the consumer products market.