McCormick Expands Stake in Mexican Subsidiary with $750 Million Acquisition

McCormick & Company is expanding its stake in its Mexican subsidiary, McCormick de Mexico, by acquiring an additional 25% ownership for $750 million. This acquisition is expected to enhance McCormick's market leadership in Mexico's condiment and sauce sector and provide a strategic platform for expansion across Latin America. The transaction is expected to be accretive to McCormick's net sales, operating margin, and earnings per share in the first year.

McCormick & Company, Incorporated (NYSE:MKC) has announced a significant acquisition that will bolster its market leadership in Mexico's condiment and sauce sector. The company signed a definitive agreement to acquire an additional 25% stake in McCormick de Mexico S.A. de C.V. from Grupo Herdez, S.A.B. de C.V. (BMV:HERDEZ *) for $750 million [1]. This transaction, set to close early in fiscal 2026, will increase McCormick's ownership to 75% and provide a strategic platform for further expansion in Latin America.

The acquisition is expected to be accretive to McCormick's net sales, operating margin, and earnings per share in the first year. McCormick sees strong demand for its mayonnaise in Mexico, a market where the company is already a leading brand. The acquisition aligns with McCormick's strategy to position mayonnaise as a core component of its portfolio, as stated by CEO Brendan Foley [2].

The transaction will be financed with a combination of cash on hand and debt, with minimal impact on the Company's Net Debt to Adjusted EBITDA ratio. Goldman Sachs Group, Inc. (NYSE:GS) is acting as the financial advisor, and Creel, Sussman & Moore, LLP is acting as the legal advisor for McCormick & Company, Incorporated [1].

McCormick's ambitions extend beyond Mexico. The company has been investing in Central America to expand its market presence, and this acquisition provides a platform to extend its reach into other Latin American countries. The transaction comes as McCormick reported a 2% increase in sales for the second quarter, driven by higher demand for its consumer products [3].

Institutional investors have also shown confidence in McCormick's growth prospects. T. Rowe Price Investment Management Inc. increased its position in McCormick & Company by 28.6% during the first quarter, acquiring over 920,000 shares and holding approximately 1.54% of the company valued at $340.4 million [4]. Several other institutional investors have also added to their stakes in MKC, reflecting a positive outlook on the company's future performance.

References:
[1] https://www.marketscreener.com/news/mccormick-company-incorporated-signed-a-definitive-agreement-to-acquire-additional-25-stake-in-m-ce7c51d3d181f123
[2] https://www.fooddive.com/news/mccormick-expands-mexico-condiments-mayo/758319/
[3] https://www.theglobeandmail.com/investing/markets/stocks/MKC/pressreleases/34326440/mccormick-expands-stake-in-mexican-subsidiary/
[4] https://www.marketbeat.com/instant-alerts/filing-t-rowe-price-investment-management-inc-grows-position-in-mccormick-company-incorporated-mkc-2025-08-21/