Billy Bee Honey Products, maker of Canada's leading brand of honey, has been bought by McCormick & Co., a Maryland-based spice and seasonings giant, for $75 million US.
The private Toronto company, in business since 1958, was owned by the family of its 91-year-old founder, Jack Grossman.
McCormick issued a statement Thursday describing its heft in the Canadian market:
- Its Billy Bee and Doyon brands (the latter marketed in Quebec) share 60 per cent of branded honey sales in Canada.
- It supplies half of the private-label honey sold by Canadian retailers.
- It supplies an estimated 50 per cent of the honey used as an ingredient in Canadian food manufacturing.
- It has developed new products using honey, including mustard, sauces and salad dressings.
- It has about 40 employees and annual sales of about $37 million.
"This is a terrific complement to our savory products in Canada and a great extension of the sweet products we currently market in Europe and the Asia-Pacific region," McCormick president Alan Wilson said in the statement.
As things stand, Billy Bee yields operating cash flow of about $9 million a year, the U.S. company indicated. (It said that the purchase price was about eight times EBITDA, a measure of cash flow. EBITDA means earnings before interest, taxes, depreciation and amortization.)
That makes the Toronto company a small part of McCormick, which had sales of $2.9 billion and profit of $230 million in its latest full year.
McCormick hailed Billy Bee as a well-run business with non-perishable raw materials, a straightforward manufacturing process and a limited number of SKUs (meaning stock-keeping units, or distinct sizes, brands and packages).
It makes its products in Canada and has abundant supplies of Canadian honey but uses other sources as well, McCormick said.
"Over the past 50 years, the management and employees of Billy Bee have created a well-established business, and in recent years have launched some exciting value-added products," Wilson said.
"We look forward to working together to achieve further growth through innovation and distribution expansion."