DOUBLIN, Ireland
Kerry Goup, Ireland’s third largest publicly listed company, is in exclusive talks to acquire U.S. based Cargill Flavor Systems, a $200 million division of Cargill, Inc.
Cargill’s flavor and ingredient division employs 700 of the firm’s 131,000 workers. Kerry employs 20,000 and earns two-thirds of its annual $7 billion in revenue selling ingredients and flavors.
Kerry purchased Da Vinci Gourmet syrups in 2003, Jet Smoothies, Oregon Chai in 2004 and both Teawave smoothies and Caffe D’Amore specialty gourmet beverages in 2010.
Cargill, based in Wayzata, Minn., in a release confirmed it has been approached.
“Both companies are now engaging in the full consultation process with employee representatives bodies in the relevant countries, a process which should take in the region of four to six weeks,” according to Cargill.
Kerry Chief Executive Stan McCarthy says the acquisition would expand his company’s reach into the 22 countries where Cargill’s flavors operates. These include South America, South Africa and Asia operations supplying food manufacturers of drinks, dairy, savory and sweets. Kerry operates in 23 countries.
“The acquisition of Cargill Flavor Systems would again advance Kerry’s capability to provide unrivalled innovative integrated customer solutions across all food and beverage end-use-markets and extend the Group’s market spread in emerging markets,” said McCarthy.
In Cargill’s released statement, the talks were described as exclusive but “may or may not result in the sale of the business.” Analysts estimate the price of a deal could range from $350 to $500 million.
Source: Cargill