Frutarom: fresh capital for 2005 acquisitions?

Related tags Stock Stock market Iff

Israeli flavour firm Frutarom, with clear ambitions to become one
of the top ten flavour players, is seeking a listing on the London
Stock Exchange to raise funds for imminent acquisitions.

The Tel Aviv-based company said this week it will make an offering of ordinary shares in the form of shares and global depositary receipts.

"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,"​ said the group operating in the €5 billion global flavours market.

Reflecting the firm's hunger for acquisitions, 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.

"Completing this acquisition is another significant milestone and brings Frutarom closer to its target: to achieve sales revenues of US$300 million (€234m) and become one of the 10 largest multinationals in the flavours industry,"​ said Ori Yehudai, president of the Frutarom group, at the time of the IFF unit purchase.

Frutarom has openly said for a long time that it planned to float shares on an overseas exchange, in addition to the Tel Aviv Stock Exchange (TASE), in order to raise cash to meet its aggressive acquisition strategy.

Buying into IFF's fruit and vegetable extract business gives Frutarom a firm foothold in the growing natural ingredients market. Growth in the fruit and vegetable extracts market has risen in parallel to the burgeoning functional food trend, itself driven by the consumer's desire to improve health and prevent disease through food and beverage consumption.

The €819.9 million European and US fruit and vegetable extracts and powders market is on course to grow 4.5 per cent annually, reaching €1.07 billion by 2009, estimate market analysts Frost & Sullivan.

"The IFF unit purchase perfectly complements are existing activities in flavours and botanical extracts, making us a 'one-stop shop' and providing full solutions for our customers,"​ Yehudai recently told FoodNavigator.com.

Frutarom said this week the London offering is due to be concluded during the first quarter of 2005.

Sales for Frutarom in the third quarter totalled $51.4 million (39.7 million euros), a 21.2 per cent rise on the same period in 2003.

Related topics Market Trends Flavours and colours

Related news

Show more

Related products

show more

Flavor technology for bold, bright citrus flavors

Flavor technology for bold, bright citrus flavors

Content provided by ADM: Gain an Edge with Global Consumer Trends | 10-May-2023 | Case Study

Our collaborative global team of expert citrus flavorists combines technology and experience to make ADM the full-service partner you need to shape your...

Future of Functional Beverages in Europe

Future of Functional Beverages in Europe

Content provided by Glanbia Nutritionals | 05-May-2023 | Insight Guide

The strong appeal of functional beverages to support health is changing the RTD landscape in Europe. Here’s a look at Europe’s functional beverage trends...

Create Better-for-Everyone Reduced-Sugar Products

Create Better-for-Everyone Reduced-Sugar Products

Content provided by SweeGen | 04-May-2023 | Product Presentation

Consumers are growing wiser about wellness. Create reduced-sugar products that are better tasting and better for your consumers with Sweegen’s expertise...

Drinking with our eyes first

Drinking with our eyes first

Content provided by Lycored | 28-Apr-2023 | Product Brochure

Whether flavored waters, sports drinks, juices, mocktails or low alcoholic beverages, the beauty behind coloration doesn’t just lie in visual appeal, but...

Related suppliers

Follow us

Products

View more

Webinars