Frutarom Acquires 56% of Slovenian Flavor Company Etol

HAIFA, IsraelFrutarom Industries Ltd. has acquired 56% of the share capital of Slovenian flavors manufacturer Etol d.d. ("Etol") for $24.90 million. In the coming weeks, Frutarom intends to submit a takeover bid in the Slovenian stock market for the purchase of the remaining shares. If the bid is accepted in full, Frutarom will own all of Etol's share capital. The acquisition strengthens Frutaroms presence in emerging markets and expands its natural flavors portfolio.

Etol develops, manufactures and markets flavors, focusing on natural flavor products for the food and beverage industry. Etol also develops fruit-based flavors and products and food systems, specializing in local fruits of the region, as well as extensive activities in the growing area of bases for beverages that Frutarom has identified as a strategic area for the company, and in which it plans to further invest in order to substantially expand its activity.

Etol's products are sold to more than 46 countries outside of Slovenia, to a wide customer base in Central and Eastern Europe and in emerging markets, including Russia, Poland, the Ukraine, Turkey, Croatia, Serbia, Belarus, Hungary, Slovakia, Macedonia, the Czech Republic, Kazakhstan and other emerging markets characterized by higher than average growth rates in comparison with the world average market growth.

The acquisition is synergetic with Frutarom's activities, and is expected to significantly increase Frutarom's customer base and scope of sales in emerging markets, expand its product portfolio and deepen its operations and market share in these important markets. Frutarom intends to utilize Etol's research and development, sales, marketing and production capacities to develop its business in the region.

Commenting on the acquisition, Frutaroms President and CEO Ori Yehudai said: Frutarom considers this an important and strategic acquisition, which significantly expands Frutarom's operations in Central- and Eastern Europe and strengthens its presence and market share in these markets, and further positions Frutarom as a leading global player. Etol's proven abilities and many years of experience in the flavors field, with its specialization also in natural products in beverage bases, are a strategic asset for Frutarom. We forecast sales growth in the emerging markets in which Etol is active, as a result of the anticipated growth in demand and of changes in consumer preferences for processed foods and beverages. Frutarom proactively acts, and will continue to act, for the acceleration of growth in these emerging markets, by focusing on strengthening of its research and development, manufacturing and marketing and sales capabilities in these important target countries, and through additional strategic acquisitions."