Frutarom Industries Ltd. continues its momentum of acquisitions with the purchase of 100 percent of the shares of the Swiss company Mühlehof Gewürze AG (Mühlehof) for approximately US$7 million (CHF6.69 million).
The acquisition of Mühlehof is set to strengthen Frutarom’s leadership in Switzerland, allowing continued expansion and deepening activity across the country, while generating and exploiting synergies in the areas of R&D and sales.
Ori Yehudai, President and CEO of Frutarom Group, said: “This is another acquisition of activity in Frutarom’s core field which strengthens our market leadership in the field of savory overall and in Switzerland in particular, and enables us to offer our customers and Mühlehof customers a broader portfolio of solutions based on the innovation and technologies of Frutarom products in the savory segment and to even further improve our service with our now having a production base in Switzerland in the field of savory solutions.”
“In addition, we will work towards achieving the maximum possible commercial and operational efficiency from merging Mühlehof’s activity with our activity in Switzerland, Germany, Austria and Italy.”
“The Mühlehof acquisition is a continuation of the implementation of Frutarom’s rapid and profitable growth strategy and the realization of its vision ‘to be the preferred partner for tasty and healthy success.’ This is the sixth acquisition we have made this year after having acquired Unique Flavors in South Africa, the French flavors company René Laurent, the Vietnamese flavors company WFF, SDFLC in Brazil with its flavor solutions for ice creams and desserts, and acquiring Flavours and Essences in the UK which we announced last week.”
Speaking about the acquisition of F&E, a Frutarom spokesperson told FoodIngredientsFirst: “This is an add-on to our businesses, which will reinforce our growing activity in the UK, increase our market share and the product offering to the many customers of both Frutarom and F&E. We intend to exploit to the utmost the cross-selling opportunities inherent in this acquisition.”
The contract with Mühlehof was completed upon signing and financed through bank debt.
According to Mühlehof management reports, its sales turnover for the 12 months ending in June 2017 totaled approx. US$3.4 million (CHF3.35 million).
Founded in 1979, Mühlehof, engages in the development, production and marketing of savory taste solutions, including flavors, seasoning blends, marinades and functional ingredients for the food industry, with an emphasis on meats.
Mühlehof, with 9 employees, has a site in Switzerland for development, manufacturing and marketing which is included among the acquired assets. Mühlehof has a product portfolio of specialized solutions that are tailor-made for its customers and Swiss tastes that are based on considerable know-how and experience, and a broad customer base which includes leading Swiss retail chains for which Frutarom foresees a large number and variety of cross-selling opportunities.
Mühlehof’s activity is synergetic with Frutarom’s activity in Europe in the field of savory, which has grown significantly in recent years, particularly with its activity in Switzerland. Frutarom is a leading player in Switzerland in the field of flavors, including savory taste solutions and flavor extracts and products also containing fruit or vegetable or other natural components (Food Systems).
Frutarom sees a great strategic importance for rapid growth in the field of savory flavors in which it now holds a leading market position and is focused on developing unique innovative natural and healthy products with high added value at its sites throughout the world. The global market for savory flavors is growing due to the rise in the standard of living and changes in lifestyle and consumer habits bringing about increased demand for processed and convenience foods both for home consumption and for eating out.
In conclusion, Yehudai added: “Since 2015, we have already acquired 25 companies which have been successfully integrated into our global activity and have been and will continue contributing to further growth in sales and improved profits and margins through maximal capitalization on the synergies that they bring. We have an outstanding pipeline of further strategic acquisitions of companies and activities within the scope of our operations and we will continue carrying out our rapid profitable growth strategy, which is based on combining profitable internal growth and strategic acquisitions, in order to achieve the targets we recently set: sales of at least US$2 billion with an EBITDA margin of over 22 percent in our core activities by the year 2020.”
Source: Food Ingredients First
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