Officials with longtime southwest Missouri pet food ingredient provider American Dehydrated Foods and International Dehydrated Foods signed an agreement to sell to Germany-based Symrise AG for $900 million, the companies announced Jan. 31.
“We are delighted to have found in Symrise a new strong owner for our company,” ADF/IDF founder and owner William Darr said in a news release. “They share the same values and the same mindset on the further development of the business.”
Symrise is a global supplier of fragrances, flavoring, food and cosmetic ingredients that recorded sales of $3.4 billion in fiscal 2017, according to the release. ADF/IDF will be combined with France-based natural flavors company Diana Group under Symrise’s nutrition division.
The acquisition is not yet final, said Diana Communication and Sustainability Director Vanina Bordier, and a closing date has not yet been set.
She said company officials wouldn’t comment on the direction of ADF/IDF, citing antitrust laws, until the sale finalizes. The release only said the transaction is subject to the “satisfaction of customary closing conditions.”
ADF/IDF officials said Darr was unavailable to comment, and Symrise Nutrition President Jean-Yves Parisot could not be reached before press time.
Darr founded ADF/IDF in 1978 and built the meat and egg-based protein provider to annual sales of $220 million in 2018, according to the release. The Springfield-based company operates 11 manufacturing sites and two technical centers in North America.
“Our company will benefit from Symrise’s scientific know-how to further improve our products,” Darr said in the release.
“Also, Symrise’s wide global presence and broad customer base will allow ADF/IDF to expand its business further.”
The release also identified ADF/IDF’s earnings before interest, tax, depreciation and amortization margin at 23 percent. By comparison, the EBITDA margin in fourth-quarter 2018 for the S&P 500 companies combined was 32.71 percent, according to financial media company CSIMarket Inc.
The sale includes ADF/IDF’s IsoNova brand, which specializes in egg proteins for pet foods.
ADF/IDF, which operates its headquarters at 3801 E. Sunshine St., currently has about 470 employees, according to the release.
Darr and his company were represented in the sale by Chicago-based law firm Winston & Strawn LLP.
“I represented the company, the seller and council,” said Christina Tate, a partner in the firm’s Dallas office. “That involved everything from contracts to make the transaction happen to advising.”
Tate said she had not represented Darr before the Symrise deal, and she declined to answer further questions, citing attorney-client privilege. She also recently advised SlimFast in its $350 million sale to Glanbia plc in October 2018.
Winston & Strawn represents 46 companies in the Fortune 100, according to its website.
The firm made recent headlines by providing nearly $100,000 in legal consulting in December 2018 to President Donald Trump, according to a Federal Election Commission filing.
Springfield Business Journal named Darr the Lifetime Achievement in Business Award winner in 2011, and Missouri State University this month announced Darr would be inducted into its Public Affairs Hall of Fame in April.
With the purchase, financed by debt and equity, Symrise officials say the company is broadening its activities in the pet food business and expanding its position in pet food.
“The acquisition of the leading provider of natural pet food nutrition ingredients is a further breakthrough for Symrise into the pet food nutrition market,” said Symrise CEO Heinz-Jurgen Bertram, in the release. “Through this acquisition, we will also broaden our global presence especially in the USA – a strategically important growth market for us – and strengthen our customer base.”
According to the release, the purchase allows Symrise to form a fully integrated supplier of protein specialty ingredients with ADF/IDF’s experience in clean-label chicken and egg-based nutrition, along with mutual benefits of joint research and development capabilities.
Company officials say nutrition division leader Parisot, who works in France, is scheduled to be in Springfield for meetings the week of Feb. 11.
Symrise’s U.S. headquarters is in Teterboro, New Jersey.
As a public company, Symrise stock is traded on the OTC Markets Group, under the ticker symbol SYIEY. Shares closed Feb. 6 at $21.48 apiece.
Establishing a presence in the pet food industry has been a yearslong process for Symrise.
Its first venture into the pet food market was in July 2014, when it purchased the Diana Group for $1.8 billion.
Symrise also invested $56.8 million into a natural food ingredient facility in Banks County, Georgia, which is run by Diana, according to a November 2018 Symrise news release. The plant manufactures products for food ingredients for Symrise Flavor and Symrise Pet Food.
Diana has additional U.S. offices in Wisconsin, South Carolina, Oklahoma, Oregon and New Jersey.
Other U.S. ventures
Prior to the Georgia facility, Symrise announced a partnership with IBM Research in October 2018.
The IBM project, called Philyra, is developing a method of using artificial intelligence to create perfumes based on digital fragrance models, according to an October 2018 news release. Philyra uses a data-driven approach and accesses a data bank comprising fragrance formulas, fragrance families and historical data. The first Philyra project is the creation of two fragrances for Brazil-based cosmetics company O Boticario LLC.
“Now our perfumers can work with an AI apprentice by their side that can analyze thousands of formulas and historical data to identify patterns and predict novel combinations, helping to make them more productive, and accelerate the design process by guiding them towards formulas they have never seen before,” said Achim Daub, president of Symrise Scent & Care, in the October release.
Symrise plans to present the two fragrances developed through the project later this year.
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