Balchem will acquire Loders Croklaan USA, that pulled in sales of $6 million business in 2004, through the cash funded deal.
"The integration of Loders' fluidised bed encapsulation and agglomeration technologies with our current technologies will provide superior product lines that will address many needs in the food industry," says Dino A. Rossi, president and CEO of Balchem Corporation.
The Loders sell-off involves a small niche operation based in a separate facility at the firm's Channahon, Illinois operations, explains David Masters, chief financial officer at Loders. Balchem takes the small facility, while the rest will remain with Loders, he tells FoodNavigator.com.
The specialised encapsulation business represented about 5 per cent of total sales for the US Loders Croklaan business in 2004.
Fats and oils firm Loders Croklaan, with head offices in The Netherlands, was acquired in 2002 by the Malaysian palm-oil group IOI.
Since its Malay acquisition Loders has highlighted its core activities as palm-based fractions, and trans fat alternatives, to the food industry.
Divesting the specialised encapsulation business in the US is a reflection of this drive into core activities.
Encapsulation is the process of surrounding or coating an ingredient with a substrate in order to prevent or delay the release of the active or core ingredient until a certain time or set of conditions is achieved.
The food industry is increasingly taking on board encapsulation, linking the technology to a host of benefits that include: controlled release of active ingredients, masking of flavours or odours either desirable or undesirable, prevention of ingredient interaction, and improved processing and texture.
Among the many techniques used to encapsulate are spray drying, extrusion, coacervation, and fluidised bed coating.
Sodium bicarbonate, salt, leavening acids and sugar are commonly encapsulated ingredients used by the food industry.
In self-baked pizzas, for example, sodium bicarbonate is encapsulated to prevent early release of the bicarbonate and delay the reaction of the leavening phosphate until the crust reaches a specific temperature in the oven.
Seasonings such as onion, garlic and salt may also be encapsulated to improve dough processing as these seasonings can soften the dough.