Israel-based flavor and fragrance company Frutarom has acquired Hagelin, a US-based flavor company, in a $52.4m all-cash deal, as part of its strategy to reinforce its presence in the US and in the emerging markets of Latin America and Africa.
Hagelin manufactures and markets flavors and flavor technologies for the food industry with an emphasis on beverage flavors.
The company operates three R&D, production and marketing sites, and employs 84 people. It reported sales turnover of $24.2m in 2012, up 7% from 2011.
The acquisition, which is fourth for Frutarom in 2013, is expected to strengthens its foothold in the US market and expand its customer base, while creating cross-selling opportunities.
It will also strengthen the company's global range of products and technologies, which also include soft drinks, functional drinks, alcoholic beverages, and savory solutions.
Hagelin's executive team will join and contribute to Frutarom's US management.
Frutarom president and CEO Ori Yehudai said that the acquisition of this lucrative company will intensify Frutarom's technological capabilities, especially in the growing and profitable beverage flavors sector, and adds to its R&D capabilities, sales and marketing infrastructure and cross-selling opportunities.
"This acquisition is yet another step in the growth of Frutarom's profitable flavor business in the US, a market we identified as a key strategic target."
"Our US activity in recent years is exhibiting consistent organic growth that is at higher rates than the market's average growth rates, and the acquisitions we made in the past few years accelerated this growth and increased our market share," Yehudai added.
The company noted that it will continue to implement its rapid growth strategy to identify and carry out additional acquisitions of companies and activities that are synergistic.
