Reckitt Benckiser has agreed a deal to sell off its French's food business to McCormick for $4.2 billion (3.22 billion pounds).
This follows a comprehensive strategic review of the business division, which is responsible for the French's, Frank's RedHot and Cattlemen's brands. It is expected that the sale will be completed during the third quarter of 2017.
“Reckitt Benckiser has announced the sale of its food business to McCormick as part of a strategic shift towards an exclusive consumer health focus.“
Although the business is highly profitable and has experienced strong growth in recent years, Reckitt Benckiser is looking to pivot away from this market and increase its focus on its core consumer health operations.
McCormick was chosen as a buyer due to its food-focused business model and complementary corporate priorities.
Rakesh Kapoor, chief executive officer of Reckitt Benckiser, said: "This transaction marks another step towards transforming Reckitt Benckiser into a global leader in consumer health and hygiene, ensuring we continue to deliver for shareholders and give people innovative solutions for healthier lives and happier homes."
This follows the recent completion of Reckitt Benckiser's acquisition of the Mead Johnson Nutrition Company, a move that is expected to increase the firm's revenues in consumer health by approximately 90 percent.
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