Frutarom will acquire full ownership of Israeli flavour and ingredients company Enzymotec following a net investment of approximately $210 million.
Having previously held 19% of the company, the deal sees Frutarom purchase the remaining 81% at an average price of $11.9 per share, seeing Enzymotec become a full subsidiary.
Enzymotec, which was founded in 1998, develops, produces and markets nutritional ingredients and medical foods. Its total sales in the 12 months to June 2017 were $47 million, with its nutrition segment representing $36.5 million.
Over the past five years Enzymotec has invested around $30 million in R&D activity and clinical studies. It has approximately 100 registered patents and 90 patents pending at various stages of approval throughout the world.
Frutarom hopes the deal will see its products be of better value for its customers and that it will enhance its ability to produce ‘unique natural solutions combining taste and health’.
Ori Yehudai, president and CEO of Frutarom Group, believes the acquisition will boost the company’s activity in natural specialty fine ingredients based on innovation.
He said: “We particularly see Enzymotec’s nutrition segment as playing an important part in our future profitable growth strategy that will contribute to the expansion of the portfolio of comprehensive solutions for customers of both companies in the fields of pharmaceuticals, dietary supplements, designated foods for infants in the field of infant formula (where Frutarom has almost no activity currently) and elderly clinical nutrition in which Frutarom is active.
“We look forward to welcoming Enzymotec’s excellent and experienced management team and employees to the Frutarom family and we are convinced they will provide significant reinforcement to the ranks of our management, R&D, and sales and marketing, production and supply chain.”
Enzymotec chairman Steve Dubin added: “We are pleased that we have reached an amicable agreement with Frutarom in a manner that benefits our shareholders.
“We believe that our customers will also benefit from the merger through Frutarom’s global presence and our employees will have the opportunity to thrive under Frutarom’s leadership as one of the world’s top companies in its field.”
Enzymotec has 235 employees, mainly in Israel and the US. Its products will benefit from Frutarom’s global sales platform which includes over 100 marketing centres and around 1,000 salespeople who sell to over 30,000 customers.
The deal, which is Frutarom’s ninth acquisition of 2017 so far, is expected to close in the first quarter of 2018.
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