Dive Brief:
- Private equity firm CVC Capital Partners said it would acquire dessert and bakery ingredients supplier Irca from owner Advent for an undisclosed amount.
- The deal for the Italy-based ingredients maker is set to close in the fourth quarter of this year, with CVC saying it plans to support Irca's growth ambitions across the U.S. and Europe.
- This is CVC's second deal for an ingredients supplier in the past month. The private equity firm announced at the end of May it would buy IFF's ingredients business for $4.3 billion.
Dive Insight:
The purchase of Irca, along with its recent acquisition of IFF's food ingredients business, immediately positions CVC as a formidable player in the ingredients sector that can serve a wide variety of customers. IFF gives the private equity firm a presence in specialty and clean-label ingredients, while Irca allows CVC to play in indulgence and desserts.
Under Advent's ownership, Irca has increased revenue from 370 million euros in 2021 to 1.5 billion euros, or $1.7 billion, today. Irca produces ingredients and semi-finished products for the pastry, bakery, chocolate and ice cream markets around the world, serving customers in over 100 countries and operating a global manufacturing network of 19 facilities.
Irca substantially bulked up its U.S. presence in 2023 with the purchase of Kerry's sweet ingredients business, which gave the Italian company four manufacturing facilities in the United States. Under Advent, Irca also acquired Italian pistachio ingredients company Anastasi Group and artisanal fruit-based ingredients company Cesarin SpA.
CVC has plans to grow Irca even further through more acquisitions and continued international expansion, according to a press release. The deal gives CVC a broad range of customers from local bakeries and gelato shops to giant food manufacturers and foodservice operators.
“Irca combines a strong market position, a resilient business model and significant opportunities for further international expansion," Giampiero Mazza, managing partner at CVC, said in a statement. "Working alongside management, we will support the company’s continued development through operational excellence initiatives, selective acquisitions and investment in its global platform.”
CVC's acquisition is the latest deal to shake up the ingredients space as suppliers look to capitalize on a surge in reformulation to meet consumer demands for premium products, functional ingredients and minimally processed foods.
Other companies have looked to expand their formulation capabilities through acquisitions. Within the past few months, Ingredion announced a $3.6 billion deal to acquire rival Tate & Lyle while Splenda owner Heartland Food Products agreed to buy the Americas business of sweetener maker Whole Earth Brands.
