McCormick & Co. has signed an agreement to buy Polish spices firm Kamis for US$291m.
The purchase, the US company said today (28 June), will extend its presence in western Europe into Poland and other markets in the Central and Eastern Europe.
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Kamis is a privately-held producer of spices, seasonings and mustards. It holds around a 45% share of the spice and seasoning category in Poland, and a 30% share of the mustard category, McCormick said.
The business employs around 1,250 staff and operates a manufacturing facility near Warsaw. It also distribution subsidiaries in markets like Romania, Russia and Ukraine.
Part of Kamis’s assets and business operations are related to tea production and distribution, which will be carved-out to the selling shareholders prior to closing the transaction, McCormick said.
The deal is scheduled to be completed is expected by September but is subject to regulatory approval in Poland, Russia and Ukraine.
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By GlobalData“This acquisition is an excellent opportunity for McCormick to expand its portfolio of leading brands in Europe,” said McCormick’s president and CEO Alan Wilson. “The management and employees of Kamis have built a strong business and we look forward to working with them to develop and launch new products in other categories, accelerate penetration of other Central and Eastern European markets and expand in the food service channel.”
McCormick will finance the purchase through cash and debt, and expects to record an estimated $5m in costs related to the acquisition in 2011, which are expected to lower earnings per share by around $0.03 in fiscal 2011.
“An important part of McCormick’s growth strategy is to expand our presence in emerging markets where consumers have an increasing demand for branded packaged foods and an increased interest in new flavours,” Wilson added. “With the addition of Kohinoor in India and Kamis in Poland we expect our percentage of sales from emerging markets to exceed 12% in 2012.”
Earlier this month, McCormick told analysts that it has a “robust pipeline” of acquisition targets, a day after announcing its new Kohinoor Speciality Foods India venture with local company Kohinoor Foods.
