Givaudan expands presence in Brazil by acquiring Centroflora Nutra

21 Sep 2017 --- Givaudan is acquiring Centroflora Nutra, the Nutrition Division of Centroflora Group, as part of its 2020 strategy to strengthen its global offering of natural extract ingredients and further develop its presence in Brazil. Centroflora Nutra manufactures botanical extracts and dehydrated fruits for the food, beverage and consumer goods sectors. It offers a wide variety of plant extracts from various regions of the world, with a particular focus on those from the great biodiversity of Brazil. 

With headquarters and a manufacturing facility in Botucatu, Brazil, Centroflora Nutra employs about 116 people and exports products globally. 

Gilles Andrier, CEO of Givaudan says: “The acquisition of Centroflora’s Nutrition Division fits well with our 2020 strategy to expand our offering in naturals and is aligned with our sustainability goals. It offers a unique opportunity to strengthen our naturals sourcing platform for Givaudan’s flavors, fragrances and cosmetics businesses. Centroflora’s comprehensive sustainability management program will reinforce our company’s contribution to preserving the environment, stimulating the well-being of communities from which we source, and safeguarding resources for the long term.”

Speaking to FoodIngredientsFirst, Ingrid Janson, Givaudan said: “There is a strong global trend towards well-being – looking after the body through healthy eating and exercise. In general, products with natural ingredients are viewed by consumers as healthier and of better quality than more highly processed products and this is a strong driver of purchasing decisions.” 

“There is also a strong trend towards authenticity and going ‘back to basics’. Consumers are looking for food and drink products with short ingredients lists and simple ‘kitchen cupboard’ ingredients – as close as possible to home-made – and the move towards botanicals reflects this.”

The trend is likely to increase the already growing demand for natural ingredients, putting pressure on the supply of key ingredients. As the largest global buyer of raw materials in the flavor industry, we see responsible sourcing and security of supply as vital to our business and the communities where we source. 

“Our world-leading expertise and understanding of flavor creation means we are well-placed to navigate these complex challenges and discover new consumer-preferred solutions,” she adds. 

The acquisition of Centroflora’s Nutrition Division fits well with the company's 2020 strategy to expand offerings in naturals and is aligned with their sustainability goals. Centroflora has a comprehensive sustainability management program which will reinforce the company’s contribution to preserving the environment, stimulating the well-being of communities and safeguarding resources for the long term.

Balancing consumer needs for natural products while preserving natural resources is a top priority for Givaudan. “The combination of Centroflora’s natural extracts portfolio and its sustainability leadership, alongside our long heritage in naturals and sustainable sourcing, will bring numerous benefits to our customers, employees and communities in Brazil and globally,” notes Janson. 

“Centroflora Nutra will also bring complementary capabilities to Givaudan with its strong portfolio of naturals, functional ingredients, traceability, organic and foodstuff ingredients,” she adds. 

Mauricio Graber, President of Givaudan’s Flavour Division notes: “Balancing consumer needs for natural products while preserving natural resources is a top priority for Givaudan. The combination of Centroflora’s natural extracts portfolio and its sustainability leadership with our long heritage in naturals and sustainable sourcing will bring numerous benefits to our customers, employees and communities in Brazil and globally.”

While terms of the deal have not yet been disclosed, Centroflora Nutra’s business would have represented approximately CHF17 million (US$17.5 million) of incremental sales to Givaudan’s results in 2017 on a proforma basis. Givaudan plans to fund the transaction from existing resources and it is expected to close in nearly 2018.

Elsewhere in the business, Givaudan is set to implement ambitious science-based targets to ensure sustainable long-term growth by committing to reduce absolute Scope 1 and 2 greenhouse gas (GHG) emissions by 30 percent between 2015 and 2030. The company also has a goal to reduce Scope 3 GHG emissions by 20 percent over the same period.

Speaking to FoodIngredientsFirst, Hallvard Bremnes, Head of Global Environmental, Health and Safety Center of Expertise said: “To reach scope 1 target we work to reduce GHG emissions generated by our own operations in the following ways: All our manufacturing sites have developed their site eco-efficiency plan, setting individual eco-efficiency targets to be achieved over a period of two to three years. Motivated to achieve these targets, site teams identify additional saving projects or improve existing ones on a continuous basis. The most successful Green Team eco-efficiency project is awarded a dedicated eco-efficiency Green Team award, as part of the Corporate Executive Committee award program that is designated to recognize employee volunteer sustainability initiatives around the world.”

“The implementation of the ‘Green Chapter’ within capital expenditure project proposals was decided by the Executive Committee in 2014. The chapter has to outline eco-efficiency aspects, a cost/benefit analysis and a ‘price on carbon’ of the proposed investment,” says Bremnes. 

“Climate change has an impact on natural resources that we rely on for our flavor and fragrance creation. Taking transformational corporate action to combat climate change is, therefore, a logical step to ensuring the sustainability of our business,” he explains. “Finally, by setting ambitious targets that contribute to climate action, we are also actively contributing to our customers' own sustainability targets.”

Givaudan plans to achieve a 30 percent GHG emissions reduction by 2030, by converting its electricity supply to fully renewable sources by 2025 and leading significant energy consumption reduction projects across its operations. For its scope 3 target of 20 percent GHG emissions reduction, Givaudan will engage with its suppliers to reduce the carbon footprint of purchased goods and services. 

CEO, Andrier states: “Givaudan is proud to set ambitious science-based targets that reflect our commitment as an industry leader, while continually striving to anticipate the needs of our customers and their consumers. By reducing absolute GHG emissions, we are delivering on our 2015 ‘Road to Paris’ commitment to mitigate climate change and are actively contributing to our customers’ own sustainability targets.”

The transition to a long-term science-based GHG reduction target, which represents a consolidation and strengthening of its existing eco-efficiency targets, allows Givaudan to take transformational corporate action to combat climate change.

Alberto Carillo Pineda, Leader of the Science-Based Targets initiative Steering Committee adds: “Our independent team of experts has approved Givaudan’s science-based targets in line with the global effort to keep temperatures below the 2-degree threshold, a key goal of the 2015 Paris Agreement on climate action. We applaud their initiative to reduce GHG emissions in their own operations, while also working closely with suppliers to embrace their commitment to a low-carbon future.”

Givaudan’s move to science-based targets as climate action best practice follows on a 15 percent absolute reduction in GHG emissions from 2010 to 2015 and represents a logical next step in its 2020 strategy of “Responsible Growth. Shared Success.”

By Elizabeth Green