Israeli flavors giant extends its buying spree

The flavoring and ingredient empire being built by Israel’s Frutarom continues to grow, with the company acquiring eight companies in the first six months of 2015 alone.

The latest acquisition is New Jersey-based flavors company Foote & Jenks, which develops, manufactures and markets flavor extracts for the pharma, food and beverages industries, with $3 million in sales in 2014.

Established in 1933, Frutarom offers some 31,000 products, which are sold to more than 15,500 customers in 145 countries around the world, including Algeria, Kuwait and the United Arab Emirates via its Flachsmann A/S subsidiary. Now part of an international holding group, ICC Industries, the company is still headquartered in Haifa, and made a profit $63.6 million on revenues of $684 million in 2013.

Lest one think that producing flavors and fragrances is an “old tech” industry, Frutarom operates no fewer than 41 state-of-the-art research and development firms around the world, where top scientists in the chemical and flavoring industry are coming up with new ways to impart the tastes that marketers have determined customers crave.

Along with the R&D labs, Frutarom operates over 80 sales and marketing offices throughout the world, along with 34 production facilities in Europe, North America, Israel and Asia. Overall, the company has some 3,300 employees.

Frutarom’s biggest acquisition this year, and an extremely strategic one, took place in June, when the company announced it had acquired Australia’s Taura Natural Ingredients for $70 million in cash. Taura is one of the biggest companies in the world in concentrated and texturized fruit ingredients and flavorings, with a broad customer base that includes leading global and national food and beverage makers in the United States, the Asia-Pacific region and Europe. Taura’s sales over the 12 months ending March 31, 2015 reached approximately US$ 40 million.

In May, Frutarom made a smaller – but no less strategic – acquisition when it acquired 60% of the share capital of Indian flavors and fragrances company Sonarome. Besides India, Sonarome has extensive activity in about 20 African markets, particularly in Nigeria, South Africa, Ethiopia, Kenya and Mozambique – areas that Frutarom seeks to expand into.

Commenting on the Sonarome deal, Ori Yehudai, President and CEO of Frutarom Group, said that the company has set itself the goal of expanding its activity in the emerging high-growth markets of India and Africa, both through internal growth and by means of acquisitions.

“The acquisition of Sonarome, one of India’s leading domestic companies in the field of flavors and fragrances, is another key step towards attaining this goal,” Yehudai said. “Combined with Sonarome’s activity, Frutarom will continue to develop and deepen its presence in the important markets of India and Africa, capitalize on Sonarome’s R&D and sales and marketing platform and integrate it with Frutarom’s global R&D and sales and marketing infrastructure in order to leverage and realize the many cross-selling opportunities arising from this acquisition.”