McBride, the European maker of private-label and contract-manufactured cleaning and hygiene products, has struck a long-term partnership with Vestacy, the home-care group behind Air Wick, Calgon, Cillit Bang and Mortein.
The deal covers two contract manufacturing agreements, each running for five to eight years, under which McBride will produce a range of household products for Vestacy.
McBride shares were 10% higher at the time of writing.
Most of the work is in laundry, a category McBride has singled out as a strategic growth priority, and much of it is currently made for Vestacy by another supplier.
To support the arrangement, McBride is buying two dedicated Vestacy plants in Spain and Portugal for a nominal sum. Production will be shared across the two Iberian sites and McBride’s existing factories in Belgium, Italy, Poland, the UK and France, keeping output close to key markets.
At maturity, the agreements, combined with other contracts being signed alongside, are expected to generate around £170m in annual revenue in the second half of the 2028 financial year, adding roughly 15% to group turnover.
McBride expects the deal to be materially earnings accretive, with margins in line with the wider group and earnings per share growing broadly in step with revenue.
Chris Smith, CEO of McBride, 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.”