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Diving overview:
- Louis Dreyfus is acquiring the food and health ingredients business of German chemical manufacturer BASF, according to a joint statement from the two companies. Financial terms of the deal were not disclosed.
- The BASF division manufactures botanical ingredients and emulsifiers for food manufacturers. The deal includes production and R&D facilities in Germany, as well as three other research centers. As part of the transaction, 300 BASF employees will relocate to Louis Dreyfus’ operations.
- As consumers seek healthier ingredients, producers in the food sector continue to expand their portfolios. Acquisitions help companies like Louis Dreyfus add more products to their portfolio, making their businesses more attractive to customers.
Dive Insights:
Louis Dreyfus, a major player in the food ingredients and agriculture market, claims the new purchase will help expand its global presence in the plant-based sector. In a press release, the company pointed to BASF’s portfolio of oils, fats, glycerin and lecithin as key assets in the deal.
James Zhou said, “We see strong potential to accelerate LDC’s evolution from a trusted raw material supplier to a trusted solutions advisor, working with customers around the world to focus on confectionery, non-dairy, ready-to-eat food, personal care and healthcare. “We are developing compelling applications for .” , Chief Commercial Officer of Louis Dreyfus.
The sale of BASF will free up the company to focus on growing other areas of its business. The company said its factory-based division was no longer a “strategic focus area” and had “limited synergies” within its operations.
“We continue to work to leverage our core product platforms and expand our business in key areas such as vitamins, carotenoids and feed enzymes,” Michael Heinz, BASF board member, said in a statement.
The plant-based meat sector has struggled in recent years, with companies like Beyond Meat and Impossible Foods reducing their workforces, adjusting their marketing strategies, and prioritizing innovation. BASF’s sale could help improve cash flow by giving up a struggling division.
In recent years, Louis Dreyfus has expanded its presence in the field of protein ingredients. Last summer, the Netherlands-based company formed a dedicated division focused on legumes such as beans and lentils. In early 2024, the processor announced plans to build a pea protein facility in Canada.
