IFF has agreed to offload its UK-based Flavour Specialty Ingredients (FSI) division to private equity firm Exponent in a $220m (£183.6m) deal.
FSI is a manufacturer of synthetic and natural base aroma chemicals used by the food and drink industry, as well as other sectors.
The proposed sale includes four dedicated manufacturing and distribution facilities in Teesside and Hartlepool in the UK, US and China, as well as additional distribution centres in Mexico, Brazil and Hong Kong.
The business serves more than 970 clients across Europe, North America and Asia, employs about 340 staff and generates more than $100m (£83.4m) in annual revenues.
Exponent’s acquisition continues its strong record of investing in food and drink businesses, including the likes of Quorn and dairy group Meadow Foods.
The PE firm said it would support the FSI’s ambition to grow significantly, both organically and through acquisitions. Exponent added the business’ global operations and “broad capabilities” meant it was well-positioned to capitalise on growth in the multibillion-dollar base aroma market, driven by global trends such as the demand for more natural flavour alternatives.
Exponent partner Mark Taylor said: “This strong market position is founded on deep technical expertise and a reputation for supplying products of the highest quality. With further investment and support as an independent business, we see a significant opportunity to accelerate FSI’s growth.”
The proposed transaction is subject to customary regulatory approvals and is expected to complete before the end of the third quarter.
It follows IFF, which is headquartered in New York, agreeing to sell its Savory Solutions Group to PAI Partners for $900m in December.