Ingredion to buy Penford in US$340m cash deal
Expanding its portfolio of speciality ingredients
Ingredion is to acquire Penford Corporation, a US-based leader in speciality ingredients for food and non-food applications, for US$340m, expanding its portfolio of speciality ingredients.
The acquisition has been approved by the boards of directors of both companies and is subject to approval by Penford’s shareholders and regulators, as well as to other customary closing conditions and could be completed by the end of this year.
‘This acquisition expands our higher-value speciality portfolio, establishes manufacturing of speciality potato starches in North America, and builds our presence in nature-based hydrocolloid ingredients,’ said Ilene Gordon, Chairman and CEO of Ingredion.
‘Penford’s range of products addresses growing consumer trends, including nutrition, gluten-free, food textures, and sustainable green solutions. The added capabilities will further enhance our efforts to deliver new, value-added solutions to the marketplace.’
Penford had net sales of $467m in fiscal year 2013. The company supplies a broad range of texture solutions for food, including customised combinations of texture ingredients with a particular emphasis on potato starches. Penford’s starch-based products for non-food applications include sustainable, nature-based solutions designed to replace synthetic ingredients.
Penford employs around 445 people and operates six plants in the US, all of which make speciality starches. Its headquarters are in Centennial, Colorado.
The deal is expected to generate annual cost synergies of at least $20m, primarily from efficiencies in manufacturing, procurement, logistics and general and administrative functions.
‘We will move quickly to integrate the businesses, attain synergy savings and provide a broader offering of higher-value specialty products to our customers around the world,’ added Gordon.
