Frutarom adds extract US business to growing portfolio
trail with news this week it will buy the flavouring extracts
business of US firm AM Todd Botanical Therapeutics, reports
Lindsey Partos.
The bolt-on €268,874 purchase through the firm's US subsidiary marks the next step in Frutarom's strategy to become one of the world's top ten flavour players.
An ambition largely fed through an aggressive acquisition strategy; earlier this year Frutarom announced plans to seek a listing on the London Stock Exchange to raise funds for new purchases.
"The company intends to use the proceeds to finance future strategic acquisitions, as part of Frutarom's growth strategy and to refinance the cost of the recent acquisition of the European food systems business of IFF," the group said in January, operating in the €5 billion global flavours market.
Reflecting the firm's hunger, in August last year Frutarom completed the €30 million acquisition of International Flavours & Fragrances (IFF) fruit preparation operations in Europe, including Germany, Switzerland and France.
Buying into IFF's fruit and vegetable extract business gives Frutarom a firm foothold in the growing natural ingredients market: a market currently enjoying success as it profits from the booming consumer trend for health and wellness products and to due to break the billion euro barrier by 2009 (Frost & Sullivan).
In a previous acquisition, Frutarom UK paid €20 million in June 2003 for the Swiss flavours company Emil Flachsmann (now Frutarom Switzerland), providing it with an increased stake in the botanical extracts market.
The Israeli firm recently confirmed its ambitious strategy for the next three to four years, announcing it is looking to more than triple turnover to $500 - 600 million by 2008, through acquisitions and "accelerated growth in core activities".
With annual sales of US$ 1.8 million, A.M. Todd Botanical Therapeutics extracts business will be absorbed into the Frutarom USA's North Bergen manufacturing facility.
