(Reuters) – U.S. agribusiness Archer-Daniels-Midland said on Tuesday it would buy UK-based flavor and ingredient firm FDL, as the company looks to expand its nutrition business.
ADM, one of the world’s largest grain traders and a major food processor, has diversified into the flavors and nutrition food business through takeovers in the sector, starting off with an acquisition of WILD Flavors for $3 billion in 2014.
FDL operates three production facilities in the UK and would record projected sales of about $120 million in 2023, ADM said.
The company did not disclose the financial details of the deal but said it expects the transaction to close by the end of January.
“Our ongoing investments to add to our flavors portfolio are helping power our strategic work to build a global leader in Nutrition,” said ADM executive Calvin McEvoy in a statement.
The move follows ADM’s acquisition of Revela Foods, a Wisconsin-based developer and manufacturer of dairy flavor ingredients and solutions.
Brokerage BMO Capital Markets said on Monday while ADM would likely face pressures on soy crush margins and ethanol margins in 2024, the company’s efforts to increase its portfolio through segments like nutrition should improve returns.
(Reporting by Sourasis Bose in Bengaluru; Editing by Shweta Agarwal)