IFF appears to be swiftly advancing its strategy to streamline operations in order to reduce costs and better meet customer needs. This marks the second significant sale announced by the ingredients giant in the last two months. “As we move forward, we will continue assessing our portfolio to ensure it aligns with our customers’ needs while also facilitating our efforts to reduce debt,” Clyburn informed analysts during the Consumer Analyst Group of New York conference in Florida on Thursday afternoon.
Exponent, a private equity firm based in the U.K., positions itself as an investor seeking unique opportunities to assist companies in transforming to achieve their full potential. Established in 2004, Exponent has a diverse portfolio that spans various sectors, including theater operations, sightseeing bus tours, and electrical engineering. In the food industry, Exponent’s most notable investment is Quorn, a producer of fermented meat analogs, which it acquired in 2011 for £205 million (approximately $328 million at that time). Exponent later sold Quorn in 2015 to its current owner, Monde Nissin, for £550 million (around $825 million at the time).
In a statement, Mark Taylor, a partner at Exponent, mentioned that the Fragrance Specialty Ingredients (FSI) division’s unique portfolio piqued their interest. “This strong market position is built on extensive technical expertise and a reputation for delivering products of the highest quality,” Taylor remarked. “With additional investment and support as an independent business, we believe there is a substantial opportunity to accelerate FSI’s growth.”
Although this division generates considerable business, it remains relatively small compared to the overall IFF organization. According to IFF’s Investor Day presentation in December, the company employs around 24,000 people globally and operates over 340 sites. While the FSI division services more than 970 customers, IFF as a whole boasts a client base of 50,000.
This divestment, similar to the sale of the Savory Solutions Group, will assist IFF in reducing its debt load. These strategic moves, alongside other structural changes, aim to position IFF on a more stable financial foundation for future growth. With new private equity ownership, FSI will be classified as a large business and can concentrate on its own growth prospects, including the potential to develop products such as calcium citrate with vitamin D3, magnesium, and zinc tablets.
— Christopher Doering contributed to this report.