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Inside the Firmenich-Danisco Deal
Posted: May 16, 2007
The recent spate of acquisitions in the F&F industry shows that consolidation is ongoing, radically changing the industry’s landscape. In the wake of Givaudan’s purchase of Quest and IFF’s recent stabilization, things are heating up among top-tier companies. Now comes word that Firmenich has agreed to purchase Danisco’s flavor business for DKK 3.36 billion. The purchase bolsters Firmenich’s citrus, naturals and dairy capabilities, while expanding its expertise in vanilla, ice cream and beverage bases. The Danisco business affected generated revenues of DKK ~1.5 billion in the last fiscal year, some 2–3% of the world market.
According to Karen Saddler, vice president of communications at Firmenich, “Danisco’s flavor division represents a good fit for Firmenich because it complements our product portfolio and market coverage in flavors, positioning us among the top three in the industry. It also strengthens our position in natural ingredients for the food, beverage and fragrance markets, taking us to a unique level of expertise in both natural and synthetic ingredients. This will reinforce our capacity for innovation and our focus on a sustainable business model, making responsible use of both.
“Finally, Danisco flavor division people share our innovative and entrepreneurial spirit, and our core values, making the acquisition a great cultural fit—a key success factor in any acquisition and one that we looked at carefully.
“It is also important to underline that the acquisition fits Firmenich's long-term strategy based on industry-leading organic growth and targeted acquisitions that complement our global offering.”
Saddler says that nothing has been decided in regards to integration. Both companies will operate separately until the deal is closed, likely by the end of June. Transition plans will be announced after that time.