NEW YORK (CBSMiami/AP) – Spice maker McCormick & Company has bought the parent company French’s mustard and Frank’s RedHot brands for $4.2 billion in cash.
The Maryland-based company fought off rival bidders to purchase Reckitt Benckiser’s food business. The deal will create a combined group with annual sales of around $5 billion.
French’s and Frank RedHot brands will become McCormick’s number two and number three brands, respectively.
“RB 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,” said Lawrence E. Kurzius, McCormick’s CEO.
The deal is part of RB’s strategy to re-focus itself on consumer health and hygiene products. It bought U.S. baby formula maker Mead Johnson earlier. The company’s other brands include Nurofen, Woolite, and Clearasil.
“This transaction marks another step towards transforming RB into a global leader in consumer health and hygiene,” said Rakesh Kapoor, CEO of RB.
Reckitt’s food business is headquartered in Chester, New Jersey. The company employs 450, including some 360 in Springfield, Missouri. McCormick has said it wants to strip out around $50 million in cost “synergies” after the takeover, the majority of which would be achieved by 2020.
(© Copyright 2017 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)