IFF may Divest Business after DuPont Nutrition Buy

23.02.2021 - After completing the purchase of DuPont’s nutrition and biosciences unit, International Flavors & Fragrances (IFF) is looking to divest at least two of its expanded businesses, the Bloomberg news agency said, citing “people with knowledge of the matter.”

Andreas Fibig, IFF’s CEO, is believed to be interested in pruning the company’s portfolio, now one of the broadest in the ingredients industry following the $26 billion deal with DuPont. Bloomberg said management is working with Greenhill & Co on divestments, which could include the microbial controls business worth around $1-1.5 billion.

Additionally, the flavors and fragrances manufacturer is thought to be gauging interest in some food preparation assets that could fetch about $200-300 million as well as hedging plans to divest some other peripheral businesses later this year.

The microbial unit is a former Dow Chemical business that became part of DuPont in the mega merger of those two companies into DowDuPont, completed in 2017. The business produces industrial cleaning materials and hygiene chemicals as well as products used in paint formulations and the energy industry.

The food preparation business potentially up for sale manufactures processed fruit and other preparations used in baked goods and dairy products. IFF sold some of these assets to Frutarom in 2004, but later regained them when it took over Frutarom in 2018.

In announcing their share swap, DuPont and IFF said the combined businesses would be a global market leader in high-value ingredients and solutions for global food & beverage, home & personal care and health & wellness markets with estimated pro forma sales of $11 billion and EBITDA of $2.6 billion, excluding synergies.

On completion of the merger, DuPont shareholders owned 55.4% of the new entity, with existing IFF shareholders owning 44.6%.

Author: Dede Williams, Freelance Journalist