CSM expands global bakery ingredient reach

By Lorraine Heller

- Last updated on GMT

Related tags: Bakery ingredients, North america

Dutch firm CSM has acquired ADM's North American bakery ingredients
division in a move designed to increase the company's global reach.

The $55m acquisition of ADM's Arkady business was completed this week. The sale includes ADM's bakery enhancers, mixes, enrichments and monoglycerides business.

According to CSM, the product assortment of the new business is an "excellent fit"​ with the current portfolio of its subsidiary Caravan Ingredients (CI), which will now absorb all of the additional production.

CSM already has a strong presence in the US bakery ingredients market, primarily through its subsidiaries CI, BakeMark and Brill.

In 2005, the European firm shut down four of its bakery ingredients distribution units in the US, resulting in savings of about $78m. The company claims to currently hold second place in the North American bakery ingredients market, occupying a 7 percent share of the total $21bn market.

CSM Bakery Supplies North America, which consists of seven operating companies, supplies the industry with baking mixes, fruit fillings, fondant icing, frozen (dough) products, cakes, and special ingredients such as emulsifiers and decorations.

According to ADM, the division did not complement its long-term strategy, which is to become a "global leader in bioenergy, while advancing (its) premier position in the agricultural processing value chain"​ , which includes food and industrial products.

"CSM is more into the specialty bakery side of things, and this operation complements its business. It didn't really fit quite as well with our business,"​ the firm's Karla Miller told FoodNavigator-USA.com.

ADM, which has not as yet made a formal announcement of the sale, said the transaction includes its customer base, brands, trademarks and patents. No production facilities were included.

The company said it will continue to serve the bakery industry with a number of ingredients from other divisions, including flours, sweeteners and lecithins.

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