Cholula Hot Sauce® has long been a staple in my cupboard. The hot sauce brand would be a worthy investment for any investor, and it has found a partner in McCormick & Company. The global food behemoth recently signed a definitive agreement to acquire the parent company of Cholula for $800 million in cash.
"The acquisition of Cholula accelerates McCormick's growth opportunities within our condiment platform and broadens our portfolio in the hot sauce category with the addition of the Cholula brand," said Lawrence E. Kurzius, Chairman, President, and Chief Executive Officer, McCormick. "Hot sauce is an attractive, high-growth category and, as an iconic premium brand, Cholula is outpacing category growth. As McCormick continues to capitalize on the growing consumer interest in healthy and flavorful eating, Cholula, a brand known for authentic, bold, and spicy Mexican flavors, is a strong complement to our portfolio providing consumers and foodservice operators with an even more diverse product offering that we expect will strengthen our growth opportunities."
According to a press release, McCormick anticipates that the acquisition of Cholula will drive long-term shareholder value in the following ways:
"McCormick has a history of creating value through acquisitions,” continued Kurzis. “We have a proven track record for achieving our plans and accelerating the performance of acquired brands. We plan to grow Cholula by optimizing category management and brand marketing, while also expanding channel penetration, making McCormick the perfect home for the Cholula brand. As we remain focused on growth and creating long-term shareholder value, we are confident Cholula is a great strategic addition to the McCormick portfolio."
Cholula's annual net sales are approximately $96 million. McCormick plans to retain the Cholula brand name in both the retail and foodservice channels.
"In the last 19 months, with the support, resources, and operational expertise of the L Catterton team, we established Cholula as a high-performing stand-alone business, vastly improved our commercial execution efforts, and pivoted our foodservice strategy to position Cholula for long-term growth and success," said Maura Mottolese, Chief Executive Officer of Cholula. "With McCormick's extensive experience and unique insight into the hot sauce category and unmatched global flavor leadership, we look forward to capitalizing on new opportunities and reaching even greater heights together."
How will this acquisition further expand McCormick's operations? Deli Market News will continue to report.
