International Flavors & Fragrances (NYSE: IFF) announced on Sunday that it will merge with DuPont de Nemours’ (NYSE: DD) nutrition and biosciences business. IFF shares fell by 8.3% on Monday, while DuPont gained 0.1%.
The merger of the two companies create a combined value of USD 45.4 Billion on an enterprise value basis, reflecting a value of USD 26.2 Billion for the N&B business based on IFF’s share price as of December 13, 2019.
Under the terms of the agreement, DuPont shareholders will own 55.4% of the shares of the new company and existing IFF shareholders will own 44.6%.
The combination of IFF and N&B creates a global leader in high-value ingredients and solutions for global Food & Beverages, Home & Personal Care and Health & Wellness markets, with estimated 2019 pro forma revenue of more than USD 11 Billion and EBITDA of USD 2.6 Billion.
The complementary portfolios will give the company leadership positions across key Taste, Texture, Scent, Nutrition, Enzymes, Cultures, Soy Proteins and Probiotics categories. The combined company’s global reach and enhanced set of capabilities will enable the creation of innovative solutions to respond to customer demands and increasing consumer preferences for natural, healthier, and “better for you” products, according to IFF.
“The combination of IFF and N&B is a pivotal moment in our journey to lead our industry as an invaluable innovation and creative partner for our customers. Together, we will create a leading ingredients and solutions provider with a broader set of capabilities to meet our customers’ evolving needs,” said IFF Chairman and Chief Executive Officer, Andreas Fibig.
“With highly complementary portfolios, we will have global scale and leading positions in key growth categories to capitalize on positive market trends, drive strong profitable growth for our shareholders and create opportunities for our employees. I have been impressed by N&B’s management team, which shares our culture and values, and we look forward to welcoming them to the IFF family,” concluded Fibig.
IFF is affirming its existing 2019 full-year guidance of earnings between USD 6.15 to USD 6.35 per share on revenue in the range of USD 5.15 Billion to USD 5.25 Billion.
The transaction is expected to close by the end of the first quarter in 2021.