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McCormick snags natural flavoring manufacturer for $710M

McCormick & Co. CEO Lawrence Kurzius discusses the firm's new global headquarters. The spice makers celebrated the opening of its new building at 24 Schilling Road on Tuesday. (The Daily Record/ Adam Bednar)

McCormick & Co. CEO Lawrence Kurzius says the acquisition of FONA International will broaden the Hunt Valley-based company’s array of products. (The Daily Record/ Adam Bednar)

McCormick announced Wednesday that it has acquired FONA International, LLC, a manufacturer of “clean and natural flavors,” for $710 million. 

With this acquisition, the Hunt Valley-based company will expand its presence in the clean and natural foods market, bolstered by FONA’s predominantly natural portfolio and its experience with global regulations of clean and natural foods. FONA will also bring expertise in flavoring health and performance products, McCormick said in a news release.

“FONA’s portfolio is highly complementary to McCormick’s and will provide our customers with an even more comprehensive product offering to meet the growing demand for clean and flavorful eating, drinking and nutrition experiences,” said Lawrence E. Kurzius, chairman, president and CEO of McCormick. 

Kurzius also stressed FONA’s strong customer engagement platform, noting that the acquisition will supplement McCormick’s own focus on engagement and “insight-driven” innovation.

“We are confident McCormick will further enable FONA’s forward momentum by continuing to make investments in growth initiatives, capabilities and people,” said FONA’s founder, CEO and chairman, Joseph Slawek. “Fueled by the power of McCormick, FONA’s success will be accelerated. FONA, in turn, will be a key driver in advancing McCormick’s global flavor leadership.”

FONA, which was founded over 30 years ago and is based in Geneva, IL, makes about $114 million in annual sales, which are expected to increase at a mid-to high-single-digit rate. It is a privately held company.

This acquisition follows McCormick’s acquisition of Cholula Hot Sauce last month, adding the popular product to an existing portfolio of hot sauces and condiments.

Last month McCormick’s board of directors declared an increase in company’s quarterly dividend from $0.62 to $0.68 per share on its common stocks, which will be paid on a split-adjusted basis of $0.34 per share to reflect the 2-for-1 stock split that was effective Dec. 1.

The dividend is payable Jan. 11, 2021, to shareholders of record Dec. 31. This marks the 35th consecutive year that the company has increased its quarterly dividend. At $0.68, the quarterly dividend is double the amount paid in 2013.

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