Croda has acquired Iberchem
Croda International has acquired Spanish-based flavours and fragrances (F&F) firm Iberchem from Eurazeo in a €820 million deal. This takes the company into F&F for the first time. It will be funded by existing debt facilities and a £600 equity placing, representing about 8% of Croda’s issued share capital.
“The acquisition supports Croda’s purpose of ‘Using Smart Science to Improve Lives’,” the company said. “It also helps drive the group’s strategic objectives by focusing on faster growing core consumer markets, adding a new, high-growth adjacency to Croda’s existing personal care and home care businesses.”
Iberchem is headquartered in Murcia and has 850 employees, 14 manufacturing facilities, ten R&D centres with 240 R&D technicians including 22 perfumers and nine flavourists. It claims a commercial presence in about 120 countries. About 80% of Iberchem’s sales, which totalled €174 million in 2019 and should hit €187 million this year, are in fragrances for personal care and home care. The rest in its Scentium flavours business, principally for food, pharmaceutical and oral care applications.
The combined business will create a new full service formulation and fragrance offering, with Croda’s formulation capability complementing Iberchem’s expertise in fragrances. The key target customers will be regional, ‘own-brand’ and independent customers needing a full service offer.
Croda expects to achieve cross-selling and other revenue synergies of at least €25 million/year by the third year and €48 million/year by the fifth. The acquisition is expected to be accretive to earnings in the first full financial year.
The company said that it will also gain access to some 3,000 new customers, some in areas where it has been historically under-represented, such the Middle East, North Africa and parts of Asia and Latin America. As with the acquisition of Sederma in the late 1990s, Sederma will continue to operate as an independent entity, under its existing management, “but with extensive support from Croda”.
Separately, Scentium has opened a new 700 m2 production centre in Tunis, Tunisia, next to the Iberchem Group’s existing fragrance facility. This is described as “fully equipped for the production of liquid and powder flavours as well as emulsions”, and includes a production plant, two warehouses, laboratory installations and offices.