Plant-based ingredients provider Louis Dreyfus Company (LDC) has signed a binding agreement to acquire BASF’s Food and Health Performance Ingredients business.
The deal includes a production site, an advanced research and development (R&D) centre in Illertissen, Germany, and three application labs outside Germany.
Financial details of the deal were not undisclosed by both the parties.
BASF’s Food and Health Performance Ingredients portfolio supports human nutrition trends but lacks synergies with the German chemicals maker and is no longer a strategic focus. The deal supports BASF’s diversification strategy.
As part of the agreement, around 300 employees will transfer from BASF to LDC upon transaction closure.
Supplies and business relationships will continue without disruption.
Louis Dreyfus Company CEO Michael Gelchie said: “In line with our strategic plans for revenue diversification through more value-added products and growth in downstream markets, this agreement is an opportunity to accelerate LDC’s participation in the rapidly growing plant-based ingredients market.
“We are excited about the prospect of this transaction, as LDC’s first investment in dedicated facilities to produce food and health performance ingredients at scale.”
BASF’s Food and Health Performance Ingredients business produces plant-based food ingredients, emulsifiers, and health ingredients for global markets.
This includes aeration and whipping agents, food emulsifiers and fat powder grades, health ingredients like plant sterols esters, conjugated linoleic acid, omega-3 oils and other smaller product lines.
France-based Louis Dreyfus said the deal will help strengthen its position in nutritional and functional ingredients by leveraging BASF’s expertise in oils, fats, glycerine, lecithin, and global supply chains.
BASF board of executive directors member and Nutrition & Health division head Michael Heinz said: “Building on our teams’ success to develop this business very well over the last years, LDC as a future-oriented company can offer our employees and portfolio a promising perspective.
“The divestment of this business to LDC supports our strategic portfolio optimisation and will allow us to focus on our core businesses in Nutrition & Health.
“We remain committed to leveraging our core product platforms and expanding our business in key areas such as vitamins, carotenoids and feed enzymes.”
The agreement is subject to regulatory approvals and standard closing conditions.
In March this year, Louis Dreyfus agreed to buy 100% shares of Companhia Cacique de Café Solúvel (Cacique), a producer, processor and exporter of soluble coffee.
