(Alliance News) - Kerry Group PLC on Wednesday said it has entered into exclusive negotiations with Advent International's portfolio company IRCA to sell its Sweet Ingredients portfolio to IRCA for around EUR500 million.
The Tralee, Ireland-based taste and nutrition solutions provider for food, beverage and pharmaceutical markets said the sale to IRCA is subject to relevant regulatory approvals and routine closing adjustments.
It said the Sweet Ingredients portfolio is a "leading" manufacturer of sweet and cereal products, primarily serving end markets of bakery, cereal, confectionery, dairy and ice cream across Europe and the US.
Sweet Ingredients' operational footprint covers four manufacturing facilities in the US and six facilities across the UK, the Netherlands, Germany and France.
Kerry expects 2022 financial results for Sweet Ingredients to include revenue of EUR405 million and earnings before interest, tax, depreciation and amortisation of EUR41 million.
"We are pleased to have entered exclusive negotiations with IRCA, who have a strong track record of developing their business within the category," said Kerry Chief Executive Officer Edmond Scanlon.
"This transaction would represent another strategic development in Kerry's evolution, as we continue to look to enhance and refine our Taste & Nutrition portfolio, aligned to the areas where we can create the most value."
IRCA supplies chocolate, creams and semi-finished food ingredients to professional channels. Advent International is a private equity investor.
IRCA CEO Massimo Garavaglia added: "The Sweet Ingredients portfolio is a high-quality business with a differentiated set of technologies, and we are excited to welcome their talented team who, we believe, share our passion and drive to deliver the best for their customers and consumers."
"This acquisition would represent a strong fit with our portfolio, with its highly complementary product and technological capabilities, and help us to become a truly global player. We look forward to helping the Sweet Ingredients portfolio realise its full potential as part of the IRCA family."
The potential sale is expected to closer in the first half of 2023, with Kerry forecasting the combination of IRCA and the Sweet Ingredients portfolio to create a "global leader in semi-finished food ingredients".
Shares in Kerry were up 3.0% to EUR89.36 each in London on Wednesday afternoon.
By Greg Rosenvinge, Alliance News reporter
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