Frutarom buys Aromco for $25mn

JERUSALEM: Food flavourings and specialty ingredients company Frutarom said on Sunday it has acquired UK-based Aromco for $25 million in cash.

It was the fourth purchase by Frutarom in 2011, after buying the savory activity of Norwegian company Rieber & S?n, the assets and activities of UK company EAFI and of Christian Hansen Italia.

Ori Yehudai, Frutarom's president and chief executive, said the move was part of the company's strategy to integrate internal growth with acquisitions in order to meet a target of doubling sales in the next four years. He added that Frutarom's stable capital structure will allow it to carry out further strategic acquisitions.

Aromco develops manufactures and markets flavours for the beverage, dairy, confectionery, bakery and savoury markets with annual sales reaching $13 million in 2010.

It will be merged with Frutarom's existing activities in the UK and enable the company to broaden its market share and activities in Eastern Europe, Africa, Asia and build market share in the UK, Frutarom said.

"We will strive to maximize the numerous synergies among the different activities of Frutarom by utilizing the operating synergies in the different countries to accelerate the cross-selling opportunities and to achieve significant efficiencies and savings," Yehudai said.

Last week, Frutarom the world's seventh-largest maker of flavours and specialty ingredients, reported a slight drop in second-quarter net profit to $12.3 million, while sales rose 14.3 percent to $130.6 million.

Copyright Reuters, 2011