Frutarom has acquired Swiss-based savoury flavours company Mühlehof for around $7 million, a week after announcing a similar deal in the UK.
Mühlehof, which is based near St. Gallen is northeastern Switzerland, produces a variety of savoury taste solutions for customers in the food and beverage industry including flavours, seasoning blends, marinades and functional ingredients, with emphasis on convenience foods and meats.
It brings with it a manufacturing and development site, a workforce totalling nine people, plus ‘considerable know-how and experience’ in savoury flavour solutions. According to Frutarom, Mühlehof also boasts ‘a broad customer base’ including leading Swiss retail chains, which Frutarom intends to leverage for its cross-selling opportunities.
Its sales for the year ending June 2017 were approximately $3.4 million, Frutarom said. It is the Israeli company’s sixth acquisition of 2017 so far, and follows the deal for UK-based colours producer F&E last week.
Frutarom president and CEO Ori Yehudai said: “This is another acquisition of activity in Frutarom’s core field, which strengthens our market leadership in the field of savoury overall and in Switzerland in particular, and enables us to offer our customers and Mühlehof customers a broader portfolio of solutions based on the innovation and technologies of Frutarom products in the savoury segment, and to even further improve our service with our now having a production base in Switzerland in the field of savoury solutions.
“In addition, we will work towards achieving the maximum possible commercial and operational efficiency from merging Mühlehof’s activity with our activity in Switzerland, Germany, Austria and Italy.”
In an interview with FoodBev in July, Yehudai conceded that one of the main motivations for the company in its aggressive acquisitions strategy was to gain access to new customers in markets around the world.
“The Mühlehof acquisition is a continuation of the implementation of Frutarom’s rapid and profitable growth strategy and the realisation of its vision ‘to be the preferred partner for tasty and healthy success’,” he added. “This is the sixth acquisition we have made this year, having acquired Unique Flavors in South Africa, the French flavours company René Laurent, the Vietnamese flavours company WFF, SDFLC in Brazil with its flavour solutions for ice creams and desserts, and acquiring Flavours and Essences in the UK which we announced last week.
“Since 2015 we have already acquired 25 companies, which have been successfully integrated into our global activity – and have been, and will continue, contributing to further growth in sales and improved profits and margins through maximal capitalisation on the synergies they bring.
“We have an outstanding pipeline of further strategic acquisitions of companies and activities within the scope of our operations and we will continue carrying out our rapid profitable growth strategy, which is based on combining profitable internal growth and strategic acquisitions, in order to achieve the targets we recently set: sales of at least $2 billion with an EBITDA margin of over 22% in our core activities by the year 2020.”
Speaking exclusively to FoodBev, Yehudai also said he was ‘very confident’ of meeting those targets, based on the company’s strong cash flow generation.
The company is already strong in Switzerland with a leading position in flavours, including including savoury taste solutions and flavour extracts, as well as products containing fruit, vegetable or other natural components and natural speciality fine ingredients.
© FoodBev Media Ltd 2019