IFF-DuPont N&B combination “coming to life,” CEO hails it a “transformative moment”
12 May 2020 --- IFF and DuPont Nutrition & Biosciences have jointly announced a new operating model as well as its “purpose and vision” for the intended combined company. Flagging the potential of IFF and N&B to “shape the future” of the F&B industry, Andreas Fibig, IFF Chairman and CEO, who will continue these roles with the combined company, says “a leadership team, executive committee and operating philosophy has been identified.” The organization will include four divisions: Taste, Food & Beverage, Scent, Health & Biosciences and Pharma Solutions.
The combined company’s organizational and go-to-market model will leverage the capabilities and offerings of both organizations. With in-class capabilities and talent, the combined company will be uniquely positioned to successfully integrate both businesses and meet synergy commitments, anticipate customer needs faster and deliver on its long-term growth and profitability goals.
A new Integrated Solutions Center of Excellence will also be created to focus on incubating new business opportunities in total product solutions. In addition, IFF will establish a Center for Commercial Excellence to support business and commercial teams through development of best practices, customer insights analysis, resource deployment and the optimization of pricing strategies and solutions. Each group will be led by a newly appointed senior executive.
The Taste, Food & Beverage division – which brings together IFF’s Taste division and N&B’s Food & Beverage segment and will be the combined company’s largest division – will represent approximately US$6.1 billion in pro forma 2019 net sales for the combined company.
IFF’s Taste offering includes flavor compounds and natural taste solutions, such as Savory Solutions and Inclusions, while N&B’s food and beverage portfolio includes natural and plant-based specialty food ingredients, such as Functional Solutions, Protein Solutions and Emulsifiers and Sweeteners.
Fibig will be actively involved in guiding this division. “The past few months have affirmed the essential role our respective businesses play in delivering solutions to our partners around the world. Our teams have risen to the challenge in a way that gives me even greater confidence in the potential of IFF and N&B to shape the future of our industry together,” he explains.
“Our joint Integration Management Office has remained closely focused on developing the plans and structures to bring our combination with N&B to life. The progress that we have made to identify a leadership team comprising the best-of-both organizations and an operating philosophy builds on our combined deep histories of creativity, innovation and caring for our communities.”
“This is a truly transformative moment for us and one that will present tremendous opportunities for all our stakeholders, including our employees, customers and shareholders,” he adds.
“Together with N&B, new IFF will be an extraordinary business with an extraordinary team around the world, so we need a purpose and a vision that can guide us to even greater heights. We will drive greater R&D discoveries, expand our customers’ opportunities by creating the industry’s first truly integrated solutions and change our communities, and our world, for the better.”
Health & Biosciences
The Health & Biosciences (H&B) division will represent approximately US$2.3 billion in pro forma 2019 net sales for the combined company. This division will contain N&B’s current Health & Biosciences business, with the exception of food protection, which will become part of the combined company’s Taste, Food & Beverage division. IFF’s legacy Health Ingredients and parts of Natural Products Solutions will also become part of the new H&B division. This portfolio will include sustainable, clean label and high-performance solutions such as Probiotics, Infant Nutrition, HMO, Fibers; Cultures, Food Enzymes; Home & Personal Care; Animal Nutrition; Biorefineries and Microbial Control.
Pharma Solutions
The Pharma Solutions division at the combined company, composed of N&B’s current Pharma Solutions business, will represent approximately US$0.8 billion in pro forma 2019 net sales for the combined company. This portfolio will include N&B’s functional excipients for pharma and dietary supplements, as well as cellulosic products for industrial applications. This offering will provide specific solutions such as controlled and immediate release dosage formats, soft and hard capsules and alginates for anti-reflux applications.
Scent
Composed of IFF’s Scent division, the combined company’s Scent division will represent approximately US$2 billion in pro forma 2019 net sales for the combined company. The Scent offering includes Fine Fragrance, Consumer Fragrance and Cosmetic Actives segments, as well as natural and synthetic ingredients.
“A transformative moment”
The latest developments come just a few short months after the initial announcement last December of the so-called “mega-merger” between IFF and DuPont’s N&B which will create a new supply side behemoth active in the food, beverage and nutrition segments. The combined businesses are highly complementary, considering the companies’ shared end markets. The new merger expects to drive approximately US$400 million of gross annual revenue synergies and the deal values the combined company at US$45.4 billion.
DuPont Executive Chairman and CEO, and incoming board member of the combined company, Ed Breen, notes the hard work that has gone into building the foundation needed to bring IFF and N&B together while continuing to manage the respective global businesses through these challenging times.
“The future executive team for the combined company is comprised of highly qualified leaders with deep knowledge and expertise in their respective areas. Together, this balanced team is well-equipped to position the new company for growth and unlock the long-term value of the IFF and N&B combination,” he says.
By Gaynor Selby
