Drogheria e Alimentari - Fact Sheet

Drogheria & Alimentari Fact Sheet May 2015

Business Description

Drogheria & Alimentari (D&A) established 1880
D&A is a leader in spices and seasonings in Italy and exports to 60 other countries
Modern production facility in Florence, Italy
Approximately 120 employees

Strategic Rationale for Acquisition

Complement McCormick strong brands across Europe and expand global leadership in spices and seasonings with a sizeable footprint in in Italy
Expand product breadth in Italy through innovation
Accelerate growth with premium brand in export markets

Agreement Overview and Financial Impact

Purchased 100% stock for €72M (approximately $81M US dollars), subject to certain closing adjustments
Purchase price consists of €50M cash payment and potential earn-out payment in 2018 of up to €35M, based upon performance of business; expect earn-out payment to have preliminary acquisition-date fair value of €22M
€50M initial payment funded with cash and debt
Based on initial cash payment, transaction multipleis approximately 9x EBITDA (earnings before interest, tax, depreciation and amortization)
Expect neutral 2015 EPS impact due to transaction, integration and financing costs, and fully accretive in 2016, excluding any net increase in fair value of potential earn-out payment

Net Sales

Annual sales approximately €50M (approximately $56M U.S. dollars)
Sales growing mid-single digit rate In Italy, D&A has approximately 1/3 of spice and seasoning category as supplier of both branded and private label products
Products sold in 60 other countries

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