Frutarom Acquires 70% of the Argentinian Flavors & Fragrances Group Meroar for US$ 11.2 million
Frutarom's Entrance into the Argentinian Market will Open Up Significant Cross Selling Opportunities in View of Frutarom's Leading Position and Broad Range of Technologies & Solutions in Latin America
HERZLIYA, Israel, March 14, 2018 (GLOBE NEWSWIRE) — Frutarom Industries Ltd. ("Frutarom"), one of the world's 10 largest companies in the field of flavors and natural specialty fine ingredients, continues its momentum of acquisitions and implementation of its rapid and profitable growth strategy, with an announcement today that it has signed an agreement for the purchase of 70% of the share capital of the Argentinian companies Meroar S.A and Meroaromas S.A. ("Meroar ") for US$ 11.2 million. The purchase agreement includes an option to purchase the balance of Meroar's shares, starting from the elapse of 3 years of completion of the transaction, at a price based on Meroar's business performance during this period. The transaction is expected to be completed over the coming months and it will be financed through bank debt.
Meroar's sales turnover in 2017 totaled approx. US$ 7.4M, while exhibiting higher profitability rates than those of Frutarom's Flavors division, which it will be integrated with. This acquisition is Frutarom's first significant entry into the important Argentinian market. Frutarom projects an accelerated growth in Meroar's activity, supported by, among other things, the numerous cross-selling opportunities generated by this acquisition, based on Frutarom's leading position in Latin American markets, and the broad range of technologies and solutions it has in these markets, as well as Meroar's leading position in Argentina.
Established in 1980, Meroar researches, develops, manufactures and markets flavors and fragrances. The group has a workforce of 40 employees and a manufacturing site in Buenos Aires, the capital of Argentina, with R&D and application labs, and separate production facilities for flavors and fragrances. Meroar has a broad portfolio of solutions, which includes fragrances for the cosmetics, personal care and household products industries, and flavors mainly for the beverage, sweets, baked goods and pharmaceutical industries. Meroar has a broad customer base in Argentina which includes leading cosmetics and food companies. Meroar's managers and founders have decades-long experience, some of it acquired in leading global companies in the flavors and fragrances industry.
The acquisition is the continuation of the implementation of Frutarom's strategy to develop global activity in the field of fragrances, with an emphasis on emerging markets with high growth rates. In 2017 Frutarom acquired the Israeli company Turpaz, with development centers in the U.S. and the South of France, as well as the Polish company Pollena Aroma, which has a modern facility that will serve as the European center for Frutarom's growing fragrances activity, which were added to Frutarom's minor existing fragrance business concentrated …