Israeli flavors and specialty fine ingredients company Frutarom Industries Ltd. (TASE: FRUT; LSE:FRUT; OTCBB:FRUTF) has acquired 75% of Polish savory flavor solutions company AMCO Sp for $20.7 million. This is Frutarom's eleventh acquisition in 2015 as the company pursues its growth strategy of global expansion.
The purchase agreement includes an option for acquiring the remaining balance of shares starting two and a half years from the closing date of the transaction at a price based on the company's business performance. The transaction will be financed using bank debt and will be completed within the next few weeks. The acquisition will boost Frutarom's sales in the growing Polish market.
AMCO, founded in 1998, has an R&D and sales and marketing center and a state-of-the-art production site in Warsaw, Poland with large production capacity and significant room to expand. AMCO employs a staff of 70, including 12 engaged in R&D. AMCO's main activity is the development, production and marketing of unique and innovative savory flavor solutions (the non-sweet spectrum of flavors) that include seasoning blends, marinades, and functional ingredients for the food industry. AMCO's sales in the 12-month period ending September 2015 were $19.5 million.
The company's founders who have been running AMCO successfully will continue in their managerial roles with the company and as shareholders.
Frutarom Group president and CEO Ori Yehudai said, "This is a key strategic acquisition that solidifies Frutarom's position as one of the world's top companies for flavors, and reinforces its presence and standing as a leading global producer of natural, healthy and innovative savory solutions. The acquisition constitutes a significant entry into the important and expanding Polish market where Frutarom is gaining a modern state-of-the-art production site. As a global manufacturer, this acquisition provides Frutarom the advantages of possessing a local R&D and production platform for shortening delivery times and improving customer service in the region. In the future, AMCO's R&D labs and modern state-of-the-art plant will also help boost Frutarom's activity in Poland in the field of sweet flavors.
Published by Globes [online], Israel business news - www.globes-online.com - on November 11, 2015
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