IFF announced it has entered into an agreement to sell its Flavour Specialty Ingredients (FSI) business to Exponent, a leading UK-based private equity firm, for USD 220 million in cash proceeds. FSI reports through IFF’s Scent division and is a leading manufacturer of synthetic and natural base aroma chemicals used in the flavour market. Cash proceeds from the transaction, net of taxes and expenses, will be used to reduce outstanding debt.
“Aligned with our strategy, we’re continuously evaluating our portfolio to identify opportunities to strengthen our financial profile,” said IFF CEO Frank Clyburn. “The sale of FSI will improve our capital structure while allowing us to focus on our core businesses to enhance growth and returns. We appreciate the contributions of our FSI colleagues, who have shared our commitment to quality and customer service. We will work closely with Exponent to have a successful transition and look forward to FSI’s bright future.”
IFF’s FSI is a leading manufacturer of specialty base aromas with a broad range of more than 1,000 aroma chemicals and natural extracts, which provide inputs primarily to the flavour market. FSI includes four dedicated manufacturing and distribution facilities at Teesside and Hartlepool, United Kingdom; Cincinnati, United States; and Pucheng, China, with additional points of distribution in Mexico, Brazil and Hong Kong. With approximately 340 employees, IFF’s FSI business serves more than 970 customers and generated more than USD 100 million in revenue over the last 12 months.
IFF and Exponent expect to close the transaction by the end of Q3 2023, subject to customary closing conditions. Centerview Partners LLC acted as financial advisor to IFF, and Cravath, Swain & Moore LLP provided legal support.
Following the March, 2022 decision to divest from the Russian market, Ball Corporation announced that it has completed the sale of its beverage packaging business in Russia to Arnest Group for USD 530 million. The purchaser, Arnest Group, has acquired all of Ball Corporation’s Russian-based business.
“This decision is the result of many months of consideration, delivering a solution that best secures the future of Ball’s colleagues and assets in Russia. We believe this is a sound outcome for Ball in these geo-political circumstances,” said Dan Fisher, president and CEO Ball Corporation.
Arnest is the largest manufacturer of perfume, cosmetic and household products in aerosol packaging in Russia and Ball’s Aluminum Aerosol division has had the opportunity to work with the world class team at Arnest in the past. The closing of this transaction is not subject to any conditions, and all required approvals have been obtained. The sale is not expected to impact Ball’s businesses outside of Russia.
Symrise AG successfully continued its profitable growth course in the third quarter of 2021. The Group recorded excellent organic sales growth of 8.3 %. In the first nine months of the current financial year, growth even amounted to 9.2 %. Taking into account the portfolio effect from the acquired fragrances business of Sensient as well as currency translation effects, Group sales rose to € 2,883 million during the reporting period (9M 2020: € 2,703 million), up 6.7 % compared to the prior-year period and 10.6 % in the third quarter. Both segments contributed to this positive result.
Dr Heinz-Jürgen Bertram (Photo: Symrise)
“We can look back on an exceptionally successful third quarter of 2021. As a result of the progress made in battling the coronavirus pandemic, demand has continued to increase significantly. The demand was particularly high for applications associated with more travel or leisure activities – including, for example, sun protection products, fragrances, but also applications for beverages and culinary products. We are extremely satisfied with our business development since the beginning of the year and we are continuing our accelerated growth path,” said Dr Heinz-Jürgen Bertram, CEO of Symrise AG. “This is why we are once again raising our sales forecast to around 9 %. We are confident that we can achieve even more growth than forecasted after six-months and we will make the best possible use of the remaining weeks in 2021 to achieve this target.”
Applications for beverages and pet food drive strong sales growth for Flavor & Nutrition segment
The Flavor & Nutrition segment increased organic sales by a strong 10.0 % compared to the previous year. In the third quarter, organic growth amounted to 9.7 %. Taking currency translation effects into account, segment sales increased to € 1,752 million (9M 2020: € 1,646 million). Flavor & Nutrition also saw a normalization of consumer behavior owing to progress in combatting the coronavirus pandemic. The increase in out-of-home consumption exerted a positive impact and led to strong demand for beverages. At the same time, the increasing number of households with pets across the world generated high demand for pet food applications, resulting in strong growth in this business unit.
Applications for beverages recorded sales growth in the double-digit range. In all markets, growth was particularly driven by the strong increase in demand for beverages destined for out-of-home consumption.
Sales in the Savory business unit in all regions slightly exceeded the exceptionally high prior-year level, which was characterized by the particularly high demand during the initial months of the coronavirus pandemic.
Sales for sweet product solutions were slightly below the prior-year level. Medium single-digit growth driven by new customers in Latin America and Asia/Pacific was offset by the current low price level for vanilla.
The Pet Food business unit continued its strong growth compared to the already excellent prior-year period and increased sales in the double-digit percentage range. The sales development was particularly dynamic in the national markets of Mexico, Russia and South America.
The Food business unit achieved modest organic growth. This was driven by rising sales in Western Europe, while sales in North America declined slightly.
The ADF/IDF Group also developed extremely well, achieving double-digit organic sales growth. The business recorded strong growth in its home market, the American domestic market.
The Probiotics business unit, including the majority shareholding in the Swedish company Probi AB, did not maintain the strong level of the previous year and recorded a slight decline in sales. This is balanced by strong project vitality with numerous new product launches of customers.
Symrise once again raises its sales forecast for 2021
With its global presence, the continually growing, diversified portfolio and its broad customer base, Symrise considers itself as being robustly positioned despite the ongoing challenging market environment. Symrise has full delivery capability and can reliably meet the strongly rising demand in the wake of successful combatting of the coronavirus pandemic.
Based on the positive business development in the first nine months, Symrise is once again raising the sales target and now expects organic growth of around 9 % for the full year 2021. This corresponds to an increase of around two percentage points compared to the raised forecast of 7 % in August 2021. Symrise thereby highlights its aspiration to once again significantly outperform growth in the relevant market for fragrances and flavors during the current financial year. In the present business environment, current estimates assume market growth of 3 to 4 %.
Furthermore, Symrise is adhering to its profitability target for the financial year 2021 and is aiming for an EBITDA margin of more than 21 %.
The medium-term targets continue to be unchanged. The company expects to increase its sales to between € 5.5 and € 6.0 billion by the end of the financial year 2025. Symrise intends to achieve this increase with annual organic growth of 5 to 7 % (CAGR) and complementary strategic acquisitions. Profitability over the medium term is projected in the target corridor of 20 to 23 %.
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Nestlé S.A. announced that it has reached an agreement to sell its regional spring water brands, purified water business and beverage delivery service in the U.S. and Canada to One Rock Capital Partners in partnership with Metropoulos & Co. for USD 4.3 billion. The Company’s international premium brands including Perrier®, S.Pellegrino® and Acqua Panna® are not a part of the deal. The transaction is expected to close following the completion of customary closing conditions.
The sale includes the following brands in the U.S. and Canada, which had sales of around CHF 3.4 billion in 2019: Poland Spring® Brand 100 % Natural Spring Water, Deer Park® Brand 100 % Natural Spring Water, Ozarka® Brand 100 % Natural Spring Water, Ice Mountain® Brand 100 % Natural Spring Water, Zephyrhills® Brand 100 % Natural Spring Water, Arrowhead® Brand Mountain Spring Water, Pure Life® and Splash. It also comprises the U.S. direct-to-consumer and office beverage delivery service ReadyRefresh®.
The agreement follows Nestlé’s announcement last year that it would conduct a strategic review of parts of the North American waters division and sharpen the focus of its global water portfolio.
Commenting on the transaction, Mark Schneider, Nestlé CEO, said: “We continue to transform our global waters business to best position it for long-term profitable growth. This sale enables us to create a more focused business around our international premium brands, local natural mineral waters and high-quality healthy hydration products. We will also boost our innovation and business development efforts to capture emerging consumer trends, such as functional water.”
Nestlé reiterated its commitment to make its entire water portfolio carbon neutral by 2025. In 2020, Nestlé announced renewed sustainability commitments which build on existing efforts to enhance water stewardship and tackle plastic waste.
Britvic confirmed that following approval by the French Competition Authority in July, Britvic has now completed the sale of its juice assets in France to Refresco. The sale includes the three juice manufacturing sites, related private label juice business and the Fruité brand.
Britvic retains ownership of the Pressade and Fruit Shoot brands, which will be manufactured by Refresco as part of a long-term partnership arrangement. The transaction will not affect the Teisseire and Moulin De Valdonne brands or the private label syrups business, all of which are all manufactured at the company’s production site in Crolles.
This transaction supports our stated strategic priority to improve operating margins in our Western European markets, while also enables our teams to focus on growing our soft drinks portfolio of local favourite and global premium brands.
Tate & Lyle, a leading global provider of food and beverage ingredients and solutions, announces it has reached agreement to sell its oat ingredients business, based in Kimstad, Sweden, to Swedish agricultural cooperative Lantmännen. Completion of the transaction will take place on 29 March 2019.
Joan Braca, President, Food & Beverage Solutions, Tate & Lyle said: “We are pleased to reach this agreement with Lantmännen which represents a good outcome for our oat ingredient employees and customers, and enables us to focus our business on serving our customers in our main food and beverage categories. We wish Lantmännen and its employees every success for the future.”
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