Glanbia Acquires Flavor Producers Business In The US

By Steve Wynne-Jones
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Glanbia Acquires Flavor Producers Business In The US

Glanbia has announced the acquisition of Flavor Producers, a US-based supplier of flavours and extracts to the food and beverage industries, from Aroma Holding Company.

Glanbia will operate Flavor Producers, acquired for an initial consideration of $300 million (€281.5 million) plus deferred consideration of $55 million (€51.6 million), within its Glanbia Nutritionals (GN) Nutritional Solutions (NS) business.

According to Glanbia, the transaction is consistent with the Irish firm's strategy of acquiring businesses that are 'complementary' to growing its Better Nutrition platforms.

It added that Flavor Producers, which boasts a 40-year history, will 'significantly expand' the group's NS flavours offering, including its natural and organic flavours offering.

'An important step'

“I am delighted to announce the acquisition of Flavor Producers, which represents an important step in the continued growth of our Nutritional Solutions business," commented Hugh McGuire, chief executive officer of Glanbia.


"This acquisition builds on our existing flavours capability and positions us well to capture long term growth opportunities in the organic and natural flavours segments. M&A is an important part of our growth strategy and this transaction represents a further opportunity to scale our NS business, unlock synergies and acquire unique and complementary capabilities.”

Financing the transaction

The transaction will be financed by Glanbia’s existing banking facilities and cash, the company said. Glanbia has a 'strong' balance sheet with net debt of $248.7 million (€233.2 million) at the end of FY 2023, a net debt to adjusted EBITDA ratio of 0.5 times, and $1.3 billion (€1.22 billion) of committed debt facilities.

The transaction is expected to close in the first half of FY 2024, subject to customary closing conditions and agreed completion accounts.

In the 12 months to February 2024, Flavor Producers achieved $86.1 million (€80.7 million) in net sales and adjusted EBITDA (before non-recurring costs) of $19.7 million (€18.5 million). The gross assets of Flavor Producers as of February 2024 were $321 million (€301 million).

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