This article first appeared on GuruFocus .
McCormick & Company ( NYSE:MKC ) said it plans to invest $750 million to increase its ownership in McCormick de Mexico to 75% from 50%, a move that would give it majority control of the business for the first time since the joint venture was formed in 1947 with Grupo Herdez. The shift marks a structural change in one of McCormick's longest-running international partnerships, potentially allowing the company to play a more direct role in strategic and operational decisions in the Mexican market.
The company said the transaction is expected to be accretive to net sales, adjusted operating margin, and adjusted earnings per share beginning in 2026, while also supporting a deeper presence in Mexico and broader expansion across Latin America. McCormick de Mexico manufactures and markets mayonnaise, mustard, sauces, condiments, spices, and teas, primarily under the McCormick brand, and is a leading player in Mexico's condiments and sauces market, generating roughly $800 million in annual net sales with mid-single-digit growth.
Historically, McCormick's 50% stake provided meaningful economic exposure but limited control, as the business was accounted for as a joint venture. With a 75% ownership position, the company could be better positioned to apply its global capabilities in category management, innovation, and marketing. Bank of America analyst Peter Galbo said the firm is positive on the transaction, noting it could provide additional EBITDA and earnings accretion at a relatively attractive multiple while aligning with McCormick's longer-term strategy to address geographic and product expansion opportunities.
