Frutarom said it considers the Rieber Industrial Spices Savory activity to be “highly synergistic” with its existing savoury flavour business in Europe, which encompasses a host of recent acquisitions, including the savoury activity of Chr. Hansen in 2009, and Gewuerzmueller and Nesse, acquired in 2007 and 2006 respectively.
Rieber Industrial Spices Savory makes flavors, seasonings, and functional ingredients mainly for Scandinavia-based food manufacturers, specialising in processed meats, fish, and convenience foods. It has predicted annual revenue of about $6.2m (38m NOK) for 2010, Frutarom said.
The Israel-based company’s president and CEO Ori Yehudai said: "The acquisition strengthens both Frutarom's technological capabilities and its comprehensive product offering to customers around the world in the fields of savory flavors and functional foods. Additionally it broadens Frutarom's extensive global customer base by solidifying a presence in the Scandinavian market.”
Yehudai added that the global market for savoury flavours is growing as consumers are increasing their consumption of processed and convenience foods, both inside and outside of the home.
"Frutarom has identified the savory sector as an important growth engine and is investing accordingly in the development of unique and innovative products of high added value in its sites around the world,” Yehudai said. “The acquisition of Rieber, in continuation to that of the savory activity of Chr. Hansen, Gewuerzmueller and Nesse, is a step in the expansion and intensification of Frutarom's savoury activities. We intend to continue to invest in this important market segment and expand our savory activities in additional countries."
The company also said it expects this latest acquisition to help it reach its four-year ambition to more than double revenues to US$1bn.
“Our strong capital (US$351.5 in equity), the low net debt level (US$29.8), and the strong cash flow we achieve, along with the support of leading banks, will allow us to continue executing acquisitions," Yehudai said.
The acquisition is subject to approval from the Norwegian Competition Authority, which Frutarom said it expects to receive within the next few weeks.