McCormick & Co. announced Monday that it had signed an agreement to buy a popular bouillion maker in China.
Sparks-based McCormick has agreed to acquire Wuhan Asia-Pacific Condiments Co. Ltd. for approximately $141 million, according to a statement released by the company. Completion of the agreement, which is subject to regulatory approval, is expected in mid-2013, the spice company said.
The acquisition fits into McCormick's continued push to expand in overseas markets such as China, said Alan Wilson, its chairman, president and CEO, in the statement.
"McCormick first entered China more than 20 years ago to provide a local source of supply to industrial customers," Wilson said. "From this foundation we launched the McCormick brand of flavor products for consumers. Today, McCormick is one of the leading brands of spices and seasonings, with particularly strong category share in the coastal regions."
The well-known bouillon that Wuhan Asia-Pacific Condiments, or WAPC, makes and markets are popular in the central region of China, McCormick said. Founded in 1998, the Chinese company's annual sales were roughly $115 million and it employs about 900 people, primarily at a manufacturing facility in Wuhan, China.
WAPC sells through a network of distributors that serves traditional markets as well as modern grocery stores.
McCormick's consumer and industrial businesses "operate profitably in China and have grown sales at a 16 percent compound rate for the past five years," Wilson said.
"We expect approximately 15 percent of 2013 sales to come from emerging markets, a significant increase from 10 percent in 2011," Wilson said in the statement. "We are well on our way toward achieving our 2015 goal to have 20 percent of sales in emerging markets."
The spice company reported annual sales of $3.3 billion in its 2011 fiscal year, which ended Nov. 30.
On Monday, McCormick's stock rose 25 cents to $60.37 a share in New York Stock Exchange trading.