New York-based flavors and fragrances group IFF has agreed to sell its Food Ingredients business to funds advised by Luxembourg-headquartered private equity firm CVC Capital Partners in a deal valued at approximately $4.3 billion, equivalent to around 10x EBITDA.
The business, which generated nearly $3.1 billion in annual sales and approximately $430 million in EBITDA in 2025, covers texturants, emulsifiers, plant-based solutions, and other specialty ingredients for multinational food and beverage manufacturers. IFF has elected to retain a roughly 10% minority equity stake, worth approximately $200 million, and will hold a board seat in the new company.
Proceeds earmarked for debt reduction and reinvestment
IFF expects to receive approximately $3.8 billion in net cash proceeds at closing, after accounting for the retained equity, purchase price adjustments, carve-out costs, and taxes. The company intends to direct the bulk of proceeds toward debt reduction, with the remainder allocated to share repurchases and reinvestment across its remaining core segments: Taste, Scent, and Health & Biosciences.
CEO Erik Fyrwald stated, “By simplifying our portfolio to where we can create the greatest value, IFF will accelerate innovation, drive investment in R&D, and further integrate our biotechnology and naturals capabilities more effectively across our global platform. Importantly, by retaining a minority stake in Food Ingredients, we will continue to participate in the future upside of a strong business under dedicated ownership.”
The sale is the latest in a string of portfolio disposals. Including this transaction, IFF will have divested 13 businesses over recent years, generating close to $10 billion in gross proceeds.
CVC’s rationale
For CVC, which manages approximately €209 billion in assets across private equity, credit, secondaries, and infrastructure, the acquisition adds a scaled food ingredients platform to its US portfolio.
Lorne Somerville, managing partner and co-head of North American private equity at CVC, noted, “The business has built a strong position in an attractive, resilient sector supported by long-term growth trends, including increasing global food consumption and demand for clean-label products. Its global reach and proprietary technical capabilities provide a clear competitive advantage, and we see significant opportunity for continued growth.”
James Christopoulos, partner at CVC, added, “The Food Ingredients management team has done an exceptional job building a business with meaningful scale and technical depth. We look forward to partnering with the team and with IFF as co-shareholders to accelerate the next phase of growth through scale and commercial expansion.”
The deal is subject to regulatory approvals and customary closing conditions, with completion expected by the end of the second quarter of 2027.
