McCormick & Co.?s latest acquisition was a pretty sweet deal.
The Sparks-based spice and seasoning company purchased the shares of Billy Bee Honey Products last week for $75 million in cash.
Billy Bee is the leading brand of honey in Canada, with annual sales of about $37 million. The company, founded in 1958, has a 60 percent share of branded honey sales to retailers in Canada and about a 50 percent share of private label honey sold to Canadian retailers.
McCormick has made a habit of acquiring smaller consumer brands to add to its collection of seasoning and flavoring blends.
“Acquisitions are an integral part of our growth strategy at McCormick,” said Jim Lynn, a spokesman for McCormick. “Flavor is the driver for all of our acquisition efforts.”
McCormick focuses on companies that are brand leaders and located in areas where McCormick has “low market penetration,” Lynn said. Company acquisitions have accounted for 25 percent of McCormick?s sales increases in the past five years.
In November, the company purchased the assets of the Lawry?s and Adolph?s seasoning brands from Unilever for $605 million in cash.
McCormick also purchased the Thai Kitchen and Simply Asia brands in June 2006 for $97 million in cash.
Billy Bee in recent years has developed new products using honey, including mustard, sauces and salad dressings.
“Honey is a unique flavor and a healthy way to add sweetness to many foods and beverages,” Alan Wilson, McCormick?s president and chief executive officer, said in a statement. “This is a terrific complement to our savory products in Canada and a great extension of the sweet products we currently market in Europe and the Asia/Pacific region.”
McCormick?s sales in 2007 increased 7 percent to $2.9 billion from $2.7 billion in 2006.
For fiscal year 2008, the company expects sales to increase 4 percent to 6 percent.
McCormick?s stock price has decreased about 5.7 percent since the beginning of the year, ending Friday trading at $35.61 per share.
