McCormick & Co. Expands Presence in Mexico with $750 Million Investment
McCormick & Co. is making a strategic move to expand its presence in Latin America by investing $750 million to become the majority owner of a joint venture in Mexico. The spice and condiment giant acquired an additional 25% stake from Grupo Herdez in McCormick de Mexico, a joint venture that has been in existence since 1947. This transaction increases McCormick’s ownership stake to 75%.
The decision to increase its ownership in the joint venture comes as McCormick sees a surge in demand for its mayonnaise in Mexico. The company views this as an opportunity to capitalize on new growth opportunities for its condiments business in both Mexico and the broader Latin American market.
According to CEO Brendan Foley, McCormick aims to position mayonnaise as a core component of its portfolio. While the company is best known for its herbs and spices in the U.S., it is a leading mayonnaise brand in Mexico. McCormick’s mayonesa, which features a hint of lime, is a popular choice for traditional dishes like elote.
Mayonnaise is a booming $14 billion industry and ranks as the world’s second-largest condiment category. In Mexico, mayonnaise is experiencing faster growth than the overall condiment market, presenting new opportunities for McCormick to expand its market share. Foley emphasized the potential for category expansion and growth through leveraging the company’s brand strength and expertise.
Beyond Mexico, McCormick has its sights set on expanding into other countries in Latin America. The joint venture with Grupo Herdez provides a platform for McCormick to enter new markets and introduce its products to a wider audience. The company has already made strides in Central America, with investments in marketing new products and expanding distribution into countries like Guatemala and Costa Rica.
McCormick’s investment in the joint venture comes at a time when the company is experiencing strong demand for its spices, sauces, and condiments. With more consumers cooking at home, McCormick reported a 2% increase in sales for the second quarter, driven by heightened demand for its consumer products.
Overall, McCormick’s expansion in Mexico and Latin America signals a strategic move to capitalize on growing opportunities in the condiments market and strengthen its position as a global leader in the spice and flavorings industry.
