Quantcast

McCormick & Co. buying Kamis for $291M

Spice and seasonings maker McCormick & Co. Inc. said Tuesday that it is buying Polish spice company Kamis S.A. for about $291 million.

Privately held Kamis distributes in Russia and other parts of Central and Eastern Europe. McCormick executives said that the deal will expand its reach in Western Europe into Poland as well as other markets in Central and Eastern Europe.

“More than a third of consumers in Poland purchase seasonings at least every two weeks,” said McCormick CEO and Chairman Alan D. Wilson in a statement. “Kamis is growing sales at a mid-single digit rate.”

Aside from spices, Kamis makes seasonings, mustards, vinegars, sauces and marinades.

The transaction is expected to be completed by September and is subject to regulatory approvals, including anti-monopoly clearance in Poland, Russia and Ukraine.

Sparks-based McCormick said it will pay for the transaction with available cash and debt.

Acquisitions are a major part of what spurs McCormick’s sales growth, said Jim Lynn, the company’s director of corporate communications. So buying companies allows McCormick to complement its international business, and Kamis in particular fits with the company’s growth strategy in Europe, the Middle East and Africa, he said.

“We’ve ended up with attractive establishments in our brand,” Lynn said. “It comes on the heels of our joint venture in India, and that was on the heels of the end of last year’s investment in another Indian business. Emerging markets is a key focus for our business.”

The Polish company’s annual sales are about $105 million. Kamis’ customers include grocery stores, supermarkets, discount retailers, restaurants and packaged food manufacturers. The business has around 1,250 employees and a manufacturing facility located near Warsaw, according to McCormick.

Acquisition-related costs were expected to lower McCormick’s fiscal 2011 earnings by about 3 cents per share. The deal is estimated to add about 6 cents per share to McCormick’s fiscal 2012 earnings. Wilson said in a statement he expects the acquisition to help the company’s goal of 12 percent of its total sales coming from emerging markets in 2012.

Earlier this month McCormick said it was forming a joint venture with Kohinoor Foods Ltd. of India to market and sell its basmati rice and food products in that country. The company had said it will invest a total of $115 million in the transaction, which includes an 85 percent interest in the joint venture.

McCormick has acquired more than 30 companies since its beginning in 1889.

The Associated Press contributed to this article.

Leave a Reply

Your email address will not be published. Required fields are marked *

*