Spice specialist McCormick & Co. said Wednesday that it has added Fona International to its shelf, acquiring the flavor maker for $710 million in cash.
Shares of the Hunt Valley, Maryland-based McCormick were rising 1.65% to $96.39 at last check.
McCormick said it will finance the transaction with cash and commercial paper.
Founded more than 30 years ago, Fona's annual sales are about $114 million and are expected to grow at a mid-to high-single-digit rate, McCormick said. The business is headquartered in Geneva, Illinois and has about 220 employees.
"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," Lawrence Kurzius, McCormick's chairman, president and CEO, said in a statement. "Fona will be the cornerstone for accelerating McCormick's flavor platform in the Americas."
Fona's portfolio of flavors, including flavors for health and performance nutrition applications, broadens McCormick's value-add offerings with products that are highly complementary to its existing portfolio.
By combining the two companies' portfolios and infrastructures, McCormick adds manufacturing capacity as well as greater scale and expects to accelerate its global flavor growth, McCormick said.
In November, McCormick said it had agreed to acquire the parent of Cholula Hot Sauce from private-equity firm L Catterton for $800 million cash.
McCormick has seen its sales rise as a result of increased cooking at home due to the coronavirus pandemic. In September, the company posted stronger-than-expected third quarter earnings, while unveiling a two-for-one stock split.