IFF’s Frutarom buys 70% stake in gelato ingredients maker Leagel

International Flavors & Fragrances (IFF) has announced that its Frutarom division has acquired a 70% stake in ice cream ingredients producer Leagel.

San Marino-based Leagel makes a range of gelato, ice cream and toppings, selling to clients in around 25 European countries.  

As part of the deal, IFF retains an option for the residual 30% stake in Leagel to be exercised after three years.

Amos Anatot, president of IFF’s Frutarom division, said: “The purchase of the stake in Leagel aligns well with our strategic acquisition in 2017 of SDFLC Brasil Indústria E Comércio Ltda (SDFLC), a top Brazilian producer of taste solutions for ice creams and desserts.

“We see great opportunities to combine these companies and create a global platform for our ice cream ingredients business, expand our geographic reach and leverage cross-selling opportunities.”

Frutarom paid BRL 110 million ($33 million) for an 80% stake in SDFLC in 2017. When the deal was announced, the ice cream maker was in the process of building a new site to double its production output.

The SDFLC deal was one of 11 acquisitions that Frutarom secured in 2017, up from eight in 2016. 

IFF bought Israel’s Frutarom last year for $7.1 billion, in a move to expand into fast-growing categories such as natural colours, enzymes, antioxidants and health ingredients.

The combined business aims to meet increasing consumer demands for natural ingredients by focusing on the production of solutions for the health and wellness segments.

Speaking to FoodBev last May, Yoni Glickman, president of Frutarom’s Natural Solutions business, said IFF and Frutarom are “very, very complementary”.

“In the flavours space, our core business has always been around the small- and medium-sized customers globally so that’s really where we’ve focused our business for the last 80 years,” he said.

“IFF’s focus is on the large-tier multinational companies, so from that point of view it’s a very, very complementary deal. It gives the combined company access to the whole spectrum of flavour companies – food and beverage companies – from large multinationals to small, medium-sized, local, innovative companies where our focus has been.”