Croda International Plc agreed to buy Iberchem for 820 million euros ($973 million) as Europe’s largest cosmetic-ingredients maker expands into highly competitive fragrances market.
Croda said on Wednesday it plans to raise 600 million pounds ($798 million) in equity to help pay for the purchase of the asset from private equity firm Eurazeo SE.
Iberchem is a leading global fragrances and flavours company which has been majority owned by Eurazeo since 2017.
Croda said the acquisition is expected to give it access to businesses beyond its core in the fragrances and flavors market, with significant exposure to emerging markets, particularly in Latin America, Asia-Pacific, the Middle East and Africa.
“By bringing our businesses together, we are creating a new, full-service offering to our customers in consumer-care markets and a compelling platform from which to grow the combined business in the years ahead. We look forward to welcoming our new colleagues to Croda and leveraging our respective networks and expertise,” Chief Executive Steve Foots said.
Croda said it expects the acquisition to be completed by the end of 2020.
Iberchem was founded in 1985 and is headquartered in Murcia, Spain. As at August 2020, it had approximately 850 employees, 14 manufacturing facilities, 10 R&D centres and a commercial presence in 120 countries. Approximately 80% of its sales are fragrances for Personal Care and Home Care products, areas where it has a similar customer profile to Croda. A further 20% of sales are generated by its Scentium flavours business, principally for food, pharmaceutical and oral care applications.