IFF Announces the Sale of Flavor Specialty Ingredients Business to Exponent

Rhea-AI Summary

IFF (NYSE: IFF) has agreed to sell its Flavor Specialty Ingredients (FSI) business to UK-based private equity firm Exponent for $220 million. The sale aims to strengthen IFF's financial profile by reducing outstanding debt and allowing the company to concentrate on core operations. FSI is a leading manufacturer of aroma chemicals for the flavor market, generating over $100 million in revenue in the past year. The transaction is expected to close by the end of Q3 2023, pending customary conditions.

Positive

• Cash proceeds of $220 million to be used for debt reduction.
• Focus on core businesses to enhance growth and returns.

Negative

• None.

NEW YORK--(BUSINESS WIRE)-- IFF (NYSE: IFF) today announced it has entered into an agreement to sell its Flavor Specialty Ingredients (FSI) business to Exponent, a leading UK-based private equity firm, for $220 million in cash proceeds. FSI reports through IFF’s Scent division and is a leading manufacturer of synthetic and natural base aroma chemicals used in the flavor market. Cash proceeds from the transaction, net of taxes and expenses, will be used to reduce outstanding debt.

“Aligned with our strategy, we’re continuously evaluating our portfolio to identify opportunities to strengthen our financial profile,” said IFF CEO Frank Clyburn. “The sale of FSI will improve our capital structure while allowing us to focus on our core businesses to enhance growth and returns. We appreciate the contributions of our FSI colleagues, who have shared our commitment to quality and customer service. We will work closely with Exponent to have a successful transition and look forward to FSI’s bright future.”

IFF’s FSI is a leading manufacturer of specialty base aromas with a broad range of more than 1,000 aroma chemicals and natural extracts, which provide inputs primarily to the flavor market. FSI includes four dedicated manufacturing and distribution facilities at Teesside and Hartlepool, United Kingdom; Cincinnati, United States; and Pucheng, China, with additional points of distribution in Mexico, Brazil and Hong Kong. With approximately 340 employees, IFF’s FSI business serves more than 970 customers and generated more than $100 million in revenue over the last 12 months.

IFF and Exponent expect to close the transaction by the end of Q3 2023, subject to customary closing conditions. Centerview Partners LLC acted as financial advisor to IFF, and Cravath, Swain & Moore LLP provided legal support.

Cautionary Statement under the Private Securities Litigation Reform Act of 1995
This press release contains “forward-looking statement” within the meaning of the federal securities laws, including Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” “will,” “would,” “target,” similar expressions, and variations or negatives of these words. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about the proposed transaction and the expected timetable for completing the proposed transaction. The forward-looking statements included in this release are made only as of the date hereof, and we undertake no obligation to update the forward-looking statement to reflect subsequent events or circumstances.

Welcome to IFF
At IFF (NYSE: IFF), an industry leader in food, beverage, scent, health and biosciences, science and creativity meet to create essential solutions for a better world – from global icons to unexpected innovations and experiences. With the beauty of art and the precision of science, we are an international collective of thinkers who partners with customers to bring scents, tastes, experiences, ingredients and solutions for products the world craves. Together, we will do more good for people and planet. Learn more at iff.com, Twitter, Facebook, Instagram, and LinkedIn.

© 2022 by International Flavors & Fragrances Inc. IFF is a Registered Trademark. All Rights Reserved.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230215005953/en/

Media Relations:

Paula Heinkel

332.877.5339

Media.request@iff.com

Investor Relations:

Michael Bender

212.708.7263

Investor.Relations@iff.com

Source: International Flavors & Fragrances Inc.

FAQ

What is the significance of IFF's sale of its Flavor Specialty Ingredients business?

The sale enables IFF to reduce debt and focus on its core operations, enhancing its financial stability.

How much did IFF receive from the sale of its FSI business?

IFF will receive $220 million in cash from the sale.

When is the expected closing date for IFF's transaction with Exponent?

The transaction is expected to close by the end of Q3 2023.

What was the revenue generated by IFF's Flavor Specialty Ingredients business last year?

The FSI business generated over $100 million in revenue in the last 12 months.

Who is the buyer of IFF's Flavor Specialty Ingredients business?

The buyer is Exponent, a UK-based private equity firm.