Image: YouTube – Andreas Fibig from IFF and Ori Yehudai, CEO of Frutarom
IFF – International Flavors & Fragrances has acquired Frutarom, Israel’s natural ingredients company, for $ 7.1 billion, including its net debt.
The purchase, IFF’s biggest ever, will make the New York-based company the flavour industry’s second largest player, in the flavor industry, accelerates its Vision 2020 strategy to create a global leader in flavor, aroma and nutrition, and geographic reach for both companies, resulting in more exposure to fast-growing end markets and an enhanced platform to deliver sustainable and profitable growth.
IFF’s entry into the natural sector reflects the growing demand for natural scents. Givaudan announced in March a purchase agreement for 40.6% of the shares of the French group of ingredients Naturex.
Frutarom is a flavors, savory solutions and natural ingredients company, with production and development centers on six continents. It markets and sells over 70,000 products to more than 30,000 customers in over 150 countries. Frutarom is primarily focused on natural products, which drive more than 75% of its sales .
“Frutarom has an extremely attractive product portfolio, including broad expertise in naturals and diverse adjacencies with capabilities beyond our core taste and scent businesses,”said IFF Chairman and CEO, Andreas Fibig.
By combining our deep R&D expertise with Frutarom’s, we are offering our customers a broader range of solutions and accelerating our growth strategy. We believe this combination will lead to faster and more profitable growth, enhanced free cash flow and generate greater returns for our shareholders.”
Frutarom has a strong track record of growth, with expected sales of above $1.6 billion in 2018, and their previously announced target of $2.25 billion in sales by 2020.
“The growth potential for the combined company is substantial and our shareholders will continue to enjoy this upside,” added Ori Yehudai, CEO of Frutarom.