Dive Brief:
- IFF said it will sell its portfolio of functional ingredients and natural colors to nutraceutical firm SuanNutra for an undisclosed amount.
- The deal, set to close by the end of the year, covers IFF's botanical extracts, vitamins and minerals, and food enhancement assets, including its range of natural colors and antioxidants.
- The sale comes approximately two months after the flavor and fragrance giant said it would sell its food ingredients business to CVC Capital Partners for $4.3 billion in a bid to improve profitability.
Dive Insight:
The ingredients sector is becoming a hotbed for dealmaking as more food companies look to reformulate their products and cater to consumers concerned about health and wellness.
Two multibillion dollar ingredients deals have been reached in the last few months. In addition to IFF's $4.3 billion sale of its food ingredients business in May, Ingredion reached an agreement to purchase competitor Tate & Lyle for $3.6 billion.
Last year, IFF's natural ingredients operations generated approximately $170 million in revenue, the company said in a press release.
The transaction places the company at the center “of the industry's shift from synthetic dyes, preservatives and [flavors] to natural and clean-label ingredients,” SuanNutra owner Carbyne Equity Partners said in a statement. The deal with SuanNutra includes five manufacturing facilities in the U.S., Europe and Latin America.
“Clinically supported branded ingredients are where this industry is heading,” said Yoni Glickman, non-executive chairman of SuanNutra. “This expansion puts SuanNutra at the forefront of this transition.”
