|Lawrence Kurzius, chairman, president and CEO of McCormick|
“The acquisition of RB Foods strengthens McCormick’s flavor leadership with the addition of the iconic French’s and Frank’s RedHot brands to our portfolio, which will become our No. 2 and No. 3 brands, respectively," said Lawrence E. Kurzius, chairman, president and CEO. “R.B. Foods’ focus on creating products with simple, high-quality ingredients makes it a perfect match for McCormick as we continue to capitalize on the growing consumer interest in healthy, flavorful eating.”
The hot sauce category will continue to see robust growth, according to McCormick, and there are significant opportunities for expansion. McCormick said it expects growing global millennial household penetration to create substantial upside for Frank’s RedHot and the other acquired brands, increasing their respective consumer bases. McCormick management also expects revenue synergies as a result of leveraging seasonal holiday promotions and grilling events that include other McCormick products like Lawry’s, Grill Mates and other global branded spices, herbs and extracts.
As a result of increased scale, McCormick expects to achieve cost synergies of approximately $50 million, the majority of which will be achieved by 2020, with anticipated synergies split between selling, general and administrative expenses and cost of goods sold.
|Rakesh Kapoor, CEO of Reckitt Benckiser|
“Our French’s food business is a true reflection of RB’s strengths – a portfolio of great brands driven through a culture of innovation by passionate people to deliver consistent outperformance,” said Rakesh Kapoor, CEO of Reckitt Benckiser. “We are pleased to be selling to owners who can provide the necessary resources, market expertise and global platform, whilst being a good home for our people. French’s Food is well positioned to continue on its successful growth trajectory under the food-focused ownership of McCormick.”
The acquisition is contingent on customary approvals and is expected to close during the third or fourth quarter of McCormick & Co.’s fiscal 2017.