Private label cleaning product giant McBride has inked a co-manufacturing deal with Cillit Bang owner Vestacy that will boost its revenue by £170m a year by the end of 2028.
Under the agreement, McBride has acquired two dedicated factories from Vestacy in Spain and Portugal for a “nominal” consideration through a share purchase agreement.
Completion of the acquisition is expected in early 2027.
Made up of a pair of contracts lasting between five and eight years, the deal will see Vestacy fund the most of the additional equipment required across McBride’s manufacturing network, which will cost roughly £34m.
McBride will be responsible for around £12m of transition and project costs, as well as around £5m of specific capital expenditure over the next two years.
“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,” said McBride CEO Chris Smith.
The company said it expected the agreement to “materially” boost profits, and push contract manufacturing beyond 25% of McBride’s total business, a goal set out at the company’s 2024 capital markets day.
Profit margins post-deal are expected to remain in line with existing levels, and net debt is expected to increase by up to £25m at its peak in the second half of 2028.
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