Sector News

McCormick snaps up FONA International for US$710M

January 10, 2021
Food & Drink

Global flavor and seasoning player McCormick & Company has acquired a 100 percent share of FONA International, an independent manufacturer of flavors, focusing on nutritional and natural products for the food, beverage and nutritional markets.

McCormick’s clean and natural flavor platform is enhanced with the addition of FONA’s predominantly natural portfolio.

In particular, the acquisition is expected to strengthen McCormick’s leadership in better-for-you flavors for health and performance nutrition applications.

“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,” says Lawrence Kurzius, chairman, president and CEO of McCormick.

McCormick purchased the business for US$710 million in cash and expects the transaction to be neutral to adjusted earnings per share in 2021 and accretive in 2022, excluding transaction and integration costs.

FONA’s annual sales are approximately US$114 million and are expected to grow at a mid-to-high single digit rate.

“This acquisition accelerates the strategic migration of our portfolio to more value-added and technically insulated products and thus is expected to be accretive to gross margin,” details Kurzius.

Joining forces to accelerate wellness
McCormick has a history of creating value through acquisitions, explains Kurzius.

“We are confident this is a great strategic fit with our vision of being a leading flavor company.”

By combining the portfolios and infrastructures, McCormick adds manufacturing capacity as well as greater scale and expects to accelerate its global flavor growth.

The acquisition will also augment McCormick’s innovation capabilities and technology platform with the addition of FONA’s proprietary encapsulation methods.

FONA’s experienced R&D team will also bring expertise in flavoring health and performance nutrition products across a variety of applications.

“We are confident McCormick will further enable FONA’s forward momentum by continuing to make investments in growth initiatives, capabilities and people,” says Joseph Slawek, founder, CEO and chairman of FONA International.

“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,” adds Slawek.

Building on a brand
FONA is a well-recognized brand that McCormick plans to retain.

“FONA is well known in the market, in part because of its strong customer engagement platform, talented employees and investments in its future, which have driven growth for both FONA and its customers,” notes Kurzius.

“FONA will be the cornerstone for accelerating McCormick’s flavor platform in the Americas,” he asserts.

Through this acquisition, McCormick is positioned to reach a broader customer base, deepen existing customer relationships by cross-selling and establish inroads with new customers while driving innovation.

by Missy Green

Source: foodingredientsfirst.com

comments closed

Related News

September 25, 2022

Coca-Cola names new president of global ventures

Food & Drink

The Coca-Cola Co. has promoted Evguenia (Jeny) Stoichkova to president of global ventures, effective Jan. 1, 2023. Ms. Stoichkova joined Coca-Cola Bulgaria in 2004 and was most recently the president of the company’s Eurasia & Middle East division, a role she has held since 2021.

September 25, 2022

Perfect Day allies with Onego Bio to speed-up launch of animal-free eggs

Food & Drink

US-based Perfect Day, is partnering with Onego Bio, which specializes in creating animal-free eggs, aiming to accelerate the timeline to bring the eggs to the market. The business, with the use of its technology, plans to commercialize animal-free ovalbumin, the most abundant egg white protein extracted through precision fermentation.

September 25, 2022

EU fails on food waste: Report reveals bloc discards more than it imports

Food & Drink

Food waste costs the EU €143 billion per year (US$141.7 billion), with a report by Feedback EU raising the alarm of how it’s vital to reduce waste from farm to fork 50% by 2030 and the only way this will be achieved is by enforcing a mandatory directive forcing the food industry to do better and retailers to pay a tax of food waste.