Symrise receives antitrust clearance on US$900m acquisition of ADF/IDF

USA – German flavor and fragrance house, Symrise has received antitrust clearance from the Antitrust Division of the US Department of Justice for the US$900 million acquisition of International Dehydrated Foods (IDF) and American Dehydrated Foods (ADF).

Symrise announced the deal with the owners of ADF/IDF, a leading US meat and egg-based protein specialist and pioneer in all-natural nutrition ingredients, in January this year.

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As a condition of the antitrust clearance, Symrise has agreed to divest its newly built chicken-based food ingredient manufacturing facility in Banks, Georgia.

Symrise said that it has signed an agreement regarding the sale of Banks facility and related business. The Justice Department’s Antitrust Division had proposed the sale to Kerry Inc.

However, the company said that the divestment will not impact the strategic rationale of the ADF/IDF acquisition.

The flavor house said that the acquisition of ADF/IDF will complement its nutrition portfolio and contribute to a highly diversified range of natural ingredients based solutions.

“With the acquisition, we want to broaden our activities in the fast-growing pet food business and to expand our position in the attractive food nutrition market,” Symrise spokesperson Bernhard Kott said.

“The strategic acquisition of ADF/IDF perfectly delivers on our strategy to expand in fast-growing, high-margin business areas. The complementary offering will further diversify our Diana portfolio in pet food and nutrition,” he adds.

IDF/ADF are privately held companies headquartered in Springfield, Missouri, whose operations include two chicken-based food ingredient plants in Alabama and Missouri.

The companies’ combined 2018 revenue for chicken-based food ingredients used in human and pet food manufacturing was approximately US$177 million.

The transaction is expected to close before the end of the year. The transaction has been financed through a combination of debt and equity.

Strong growth nutrition unit

During the nine months to end September, Symrise reported a 7.1% growth in sales to €2.551 billion, boosted by increased demand across all its operating division.

The Nutrition segment, which includes the Diana division, with applications for food and pet food as well as probiotics, recorded the highest growth in sales at 9.4% to €516.0 million.

The main growth driver for the Nutrition segment was again the Pet Food business unit, which achieved very good double-digit growth, especially in the national markets of the USA, Colombia and Brazil.

In the food business unit, the Latin America and Asia/Pacific regions reached good growth rates, especially in the national markets of China, Mexico and Chile. In the EAME and North America regions growth was relatively modest.

In the flavor segment, which supplies flavors for foods and beverages, sales increased 5.8% to €965.5 million boosted by the Latin America and Asia/Pacific regions and the Savory business unit.

Against the backdrop of the positive business development in the first nine months, Symrise is confident that it will meet its targets for the full year 2019. Symrise continues to expect sales growth of 5 to 7% and to exceed the growth rate of the relevant market by a significant margin again this year.

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