Frutarom Acquires Aroma SA For $12.5 Million

HAIFA, IsraelFrutarom Industries Ltd. continues to implement its rapid growth strategy with a special emphasis on developing markets with its $12.5 million acquisition of Guatemalan flavor company Aroma SA. As part of the transaction, Frutarom is acquiring Aroma's efficient plant in Guatemala.

The acquisition of Aroma is the third acquisition by Frutarom in 2013. This transaction will enable Frutarom to strengthen its presence and increase its market share in the significant and growing markets of Central and South America, while significantly expanding its product range and enhancing its R&D, sales and marketing capabilities, with ownership of a local production facility that will help reduce production costs and improve services to customers in the region.

Aroma is engaged in the development, manufacture and marketing of flavors, mainly for beverages, dairy products, confectionary, snacks and convenience food. Aroma's wide customer base includes leading global food and beverage manufacturers, as well as local food and beverage manufacturers in Guatemala, Honduras, Costa Rica, El Salvador and additional growing markets, primarily in Central America.

Aroma's owner and CEO has an extensive experience in this industry and will continue to manage Aroma's business together with Frutaorm's management, in the next few years.

One of Frutarom's objectives is to expand its activities in Central and South America, both through internal growth and through acquisitions. The acquisition of Aroma follows the acquisition of Brazilian flavor company Mylner at the beginning of 2012 and the independent operation established by Frutarom in Costa Rica, which includes a R&D lab and a sales and marketing unit. Frutarom's activity in Costa Rica will be merged with Aroma that will constitute a development and production center for the region's countries.

Commenting on the deal, Ori Yehudai, president and CEO of Frutarom, said: "This transaction follows the acquisition of 75% of Russian-based PTI that we announced last week, the acquisition of South African JannDeRee at May this year and the acquisition of Brazilian Mylner and Slovenian Etol in 2012. The weight of revenues from developing markets has grown substantially from 27% in 2010 to 36% in 2012 and is expected to grow further in the wake of the 3 acquisitions in 2013. We consider the acquisition of Aroma as another strategic step to increase Frutarom's market share in high growth markets in general and particularly in Central America, which Frutarom has identified as attractive markets that will contribute to future development. Frutarom plans to continue expanding in these markets through continued strengthening of its R&D, sales and marketing activities and its supply chain and by making additional strategic acquisitions, while reinforcing its position as a leading global player."