Croda International plc, the East Yorkshire-based speciality chemical giant, said on Wednesday it agreed to acquire Murcia, Spain-based fragrances and flavours company Iberchem for about £736m.
Iberchem has been majority owned by private equity firm Eurazeo since 2017.
“The consideration will be funded via a combination of the group’s existing debt facilities and the proceeds of an equity placing, representing c.8% of Croda’s issued share capital,” said Croda.
Corad later said the placing sale and retail offer of 10.63 million shares will raise £627 million.
“The placing price of 5,900 pence represents a discount of approximately 3.0 per cent. to the closing share price of 6,084 pence on 17 November 2020 and a discount of approximately 4.4 per cent. to the middle market price at the time at which the placing price was agreed,” said the company.
Croda said of Iberchem: “As at August 2020, it had approximately 850 employees, 14 manufacturing facilities, 10 R&D centres and a commercial presence in 120 countries.
“Approximately 80% of its sales are fragrances for personal pare and home care products, areas where it has a similar customer profile to Croda.
“A further c.20% of sales are generated by its Scentium flavours business, principally for food, pharmaceutical and oral care applications.”
Croda CEO Steve Foots said: “Our expansion into the fast-growing fragrances and flavours market further increases our exposure to Consumer Care markets and adds another exciting growth adjacency to Croda’s market-leading position.
“We have known Iberchem’s team for many years and their business is highly compatible with Croda’s.
“Iberchem stands out with its significant exposure to emerging markets, extensive product portfolio well placed to adapt to sustainability trends, strong customer focus and R&D capability, and 10 year track record of consistent year-on-year growth.
“By bringing our businesses together, we are creating a new, full service offering to our customers in Consumer Care markets and a compelling platform from which to grow the combined business in the years ahead.
“We look forward to welcoming our new colleagues to Croda and leveraging our respective networks and expertise.”