FDBusiness.com

McCormick & Company, the US-based global flavour specialist, has completed the purchase of 100% of the shares of Drogheria & Alimentari, a privately held company based in Italy. McCormick announced the agreement to acquire D&A on February 20, 2015.

D&A is a leader in spices and seasonings in Italy. Annual sales are approximately €50 million ($55 million), with 80% in Italy and 20% from exports to 60 other countries.

McCormick expects to record an acquisition price of €72 million ($79 million) subject to certain closing adjustments. The expected purchase price consists of a cash payment of approximately €50 million and a potential earn-out payment in 2018 of up to €35 million based upon the performance of the business, with a preliminary acquisition-date fair value of €22 million.

The addition of the D&A business complements McCormick’s strong brands across Europe and expands the company’s global leadership in spices and seasonings with a sizeable footprint in Italy.

Founded in 1880, D&A has approximately 120 employees and a modern manufacturing facility located inFlorence, Italy.  As a supplier of both brand and private label products, D&A has approximately one third of the spice and seasoning category in Italy and exports its products to 60 other countries.

McCormick anticipates strong growth for these premium products, particularly in the US and key international markets where consumers are seeking unique and authentic ethnic flavours. McCormick expects to work with the former owners of the business and in the near-term, grow annual sales of D&A products at a mid-single digit rate.