Jul 19, 2017

French's mustard maker to be sold for $4.2 billion

McCormick & Co. has agreed to acquire the food business of UK-based Reckitt Benckiser for $4.2 billion, beating out rival bids from companies like Unilever and Hormel Foods. Included brands are French's Mustard and Frank's Red Hot.

Why it matters: This deal would make McCormick the world's third-largest condiment purveyor (behind Unilever and Kraft Heinz), up from 10th place currently. And it's paying through the nose to get there, as recent reports had the Reckitt business selling for closer to $2.4 billion. For more context, the $4.2 billion price-tag represents more than 7x annual sales and 20x EBITDA, compared to Bernstein market averages of 3.3x sales and 16.2x EBITDA (per Reuters).

M&A context: McCormick last year pulled a $2.1 billion offer to buy Premier Foods, so this is a bit of a rebound. Reckitt had put the business on the block, in part, to reduce a massive debt-load created by its recent $16.6 billion agreement to purchase Mead Johnson.

Bottom line: "While large food manufacturers struggle as consumers shun packaged foods in favor of fresher, more nutritious items, this deal allows McCormick to capitalize on the public's desire to eat better without losing the flavor and taste they covet." – Christopher Doering, FoodDive

Go deeper

Trump signs $2 trillion relief bill as U.S. coronavirus case count tops 100,000

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios

President Trump signed a $2.2 trillion coronavirus relief package on Friday, as infections in the U.S. topped 100,000 and more cities experience spikes of the novel coronavirus.

The big picture: The U.S. has the most COVID-19 cases in the world, exceeding China and Italy, per data from Johns Hopkins. A second wave of American cities, including Boston, Detroit, New Orleans and Philadelphia, are reporting influxes of cases.

Go deeperArrowUpdated 8 hours ago - Health

Coronavirus updates: Italy records deadliest day with nearly 1,000 dead

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens and confirmed plus presumptive cases from the CDC

Italy on Friday reported 969 COVID-19 deaths over a 24-hour period, marking the deadliest single-day for the country since the global outbreak began, according to data from the Health Ministry.

The big picture: The U.S. now leads the world in confirmed coronavirus cases, as the number of global cases nears 600,000. Governments around the world are trying to curb the medical and financial fallout of COVID-19, as infections surge across Europe and the U.S.

Go deeperArrowUpdated 8 hours ago - Health

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 9 p.m. ET: 595,800 — Total deaths: 27,324 — Total recoveries: 131,006.
  2. U.S.: Leads the world in cases. Total confirmed cases as of 9 p.m. ET: 103,942 — Total deaths: 1,689 — Total recoveries: 870.
  3. Federal government latest: President Trump signed the $2 trillion coronavirus stimulus bill to provide businesses and U.S. workers economic relief.
  4. State updates: Nearly 92% of cities do not have adequate medical supplies — New York is trying to nearly triple its hospital capacity in less than a month.
  5. World updates: Italy reported 969 coronavirus deaths on Friday, the country's deadliest day.
  6. Business latest: President Trump authorized the use of the Defense Production Act to direct General Motors to build ventilators for those affected by COVID-19. White House trade adviser Peter Navarro has been appointed to enforce the act.
  7. 🏰 1 Disney thing: Both Disney World and Disneyland theme parks in the U.S. are closed until further notice.
  8. What should I do? Answers about the virus from Axios expertsWhat to know about social distancing.
  9. Other resources: CDC on how to avoid the virus, what to do if you get it.

Subscribe to Mike Allen's Axios AM to follow our coronavirus coverage each morning from your inbox.