Haifa-based chemicals and flavorings maker Frutarom is being sold to U.S.-based International Flavors & Fragrances for a staggering $7.1 billion in a cash and stock deal. It is the second-largest sale of an Israeli company to date, after Intel's purchase of Mobileye for $15.3 billion in 2017.
Frutarom shareholders will receive $71.19 in cash and 0.249 of a share of IFF common stock for each share held. The total value based on present market valuations comes to $106.25 per share, Frutarom stated. It said IFF will assume its net debt.
Frutarom was established in 1934, 14 years before Israeli independence. When the company went public on the Tel Aviv Stock Exchange in 1996, it was worth $13 million. Today the company is worth $5.6 billion, an increase of over 42,600%, and has over 7,000 employees. Its 2017 sales amounted to about $4.3 billion and netted over $1.5 billion. Frutarom said it aims to achieve sales of $2.2 billion by 2020.
"This transaction is a big win and a fantastic outcome for shareholders, customers and employees of both companies," IFF Chairman and CEO Andreas Fibig said in announcing the deal on Monday.
"We have long admired Frutarom and have a great deal of respect for its team and all of its dedicated and talented employees around the globe. We look forward to welcoming Frutarom to the IFF family," Fibig said.
Frutarom President and CEO Ori Yehudai said, "Today marks the culmination of a decades-long vision to become a global leader in taste and health. Frutarom and IFF are committed to maintaining a presence in Israel, and I look forward to working with Andreas and the team to ensure a seamless integration of these two terrific companies."
