IFF

Internationa Flavors & Fragrances, Inc.

132.6900
USD
-1.17%
132.6900
USD
-1.17%
104.8600 152.9500
52 weeks
52 weeks

Mkt Cap 14.16B

Shares Out 106.69M

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IFF Said to Near $26 Billion Deal for DuPont Nutrition Unit

Photographer: Mark Makela/Getty Images
Photographer: Mark Makela/Getty Images

International Flavors & Fragrances Inc. is nearing a $26 billion deal for DuPont Inc.’s nutrition division, according to people with knowledge of the matter.

The transaction will create a new company comprised of the bidder’s assets and DuPont’s nutrition business that will be spun off to their existing investors, the people said, asking not to be identified as the discussions are private. The new company will have an enterprise value of about $45 billion, with DuPont shareholders getting a 55% stake and IFF shareholders getting 45%, the people said.

An agreement could be announced as soon as Sunday, the people said. IFF beat out Ireland’s Kerry Group for the asset. Representatives for DuPont, IFF and Kerry declined to comment.

DuPont Chairman Ed Breen and Chief Executive Officer Marc Doyle had been seeking a tax-efficient option for the unit that could reward shareholders after the value of its nutrition business had wallowed below industry levels as part of a diversified company.

DuPont will receive a one-time cash payment of about $7 billion once the deal is completed, the people said. IFF CEO Andreas Fibig will be chairman and CEO of the new company, with Breen as the lead independent director, the people said. The board will have about 13 directors, they said.

The deal, expected to be completed in early 2021, would be the biggest ever for New York-based IFF, which makes flavors and fragrances for food, beverages, personal care and household products. The company’s last big acquisition was in the food-flavoring industry, when it bought Israel’s Frutarom Industries Ltd. for $7.1 billion last year. That transaction is still absorbing management time and has increased leverage.

The DuPont deal is subject to approval from IFF shareholders and IFF has already secured the support of its biggest shareholder, 19% holder Winder Investment Pte Ltd., the people said.

The purchase would make “strategic sense, allowing IFF to offer a more complete product suite to a broader customer base,” according to Mark Astrachan, an analyst at Stifel, who said last week the deal would make it the largest global specialty ingredients company.

— With assistance by Peter Flanagan

(Updates with transaction details starting fifth paragraph)

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