McBride secures £170m manufacturing deal with Vestacy

(Sharecast News) - Household cleaning products manufacturer McBride announced a strategic partnership on Friday securing two long-term contract manufacturing agreements with Vestacy, the home care company behind brands such as Air Wick, Calgon and Cillit Bang. As part of the partnership, McBride has signed a share purchase agreement (SPA) to buy two dedicated manufacturing facilities in Spain and Portugal for a nominal consideration.

The contract manufacturing agreements, which have a duration of five and eight years, will see McBride make a variety of household products for Vestacy. The majority of these products are currently produced by a third-party supplier to Vestacy and are focused on laundry markets, a target strategic growth category for the group.

McBride said that in order to "optimise efficiency and proximity to geographical markets", production volumes will be distributed across the two newly acquired sites, together with existing McBride sites in Belgium, Italy, Poland, UK and France.

The transaction is expected to be materially earnings accretive, "significantly" advancing McBride's strategic and financial objectives, it said. At maturity, the new agreement, when combined with other contracts being signed in parallel, is expected to generate revenues annualising at £170m in the second half of FY28.

Chief executive Chris Smith said: "This transaction represents a disciplined application of our capital allocation framework, driving profitable growth that directly aligns with our strategic priorities while we continue to return capital to shareholders through our share buyback programme. For the board, a partnership of this scale with a global brand owner is further validation of the embedded value within the group.

"Securing these two manufacturing sites for a nominal consideration, underpinned by long-term, highly visible contract manufacturing agreements, enables us to further expand our European operational footprint while accelerating our growth targets within the key laundry category."

At 0815 BST, McBride shares were up 13.2% at 189.45p.

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