In a bid to enhance its spices portfolio in the domestic as well as international markets, Olam Food Ingredients has recently announced acquisition of the chile pepper business (CPB) of the US- based Mizkan America under a transaction deal of USD 108.5 million.
It has been reported that the chile pepper business firm would be acquired at an estimated net working capital of USD 55 million. The move is anticipated to come on the heels of Olam’s aim of catering to the burgeoning demand for authentic and bold flavors across a huge consumer base.
For the record, Mizkan America is well-acclaimed for its superior quality New Mexico green chiles along with other specialty chile peppers. As per credible reports, this move stands to be the first major acquisition for Olam Food Ingredients post Olam’s reorganization, and is in line with its strategy to offer customers with sustainable, value-added, and natural solutions and ingredients.
Speaking on the initiative, CEO of Olam Spices- Greg Estep reportedly cited that integrating CPB’s green chile range with its red chile portfolio would enable Olam to provide its customers an expansive range of ingredient solutions in an attempt to satisfy the elevating demand for authentic Mexican flavors.
Furthermore, the acquisition would enable Olam to bolster and expand its chile outsourcing network predominantly in Hatch Valley of New Mexico. He added that with the support of CPB senior executive leadership and an outstanding team of employees, the company would continue to grow the business even further.
Meanwhile, A. Shekhar, International CEO of Olam Food, quoted that addition of CPB’s intrinsic range of premium green chiles would pave way for the momentous growth of OFI’s portfolio in plant-based solutions, which is gaining immense popularity amongst consumers today.
According to credible sources, the transaction is subject to US antitrust regulatory approval and customary conditions which are touted to reach conclusive terms by January 2021. Incidentally, post the acquisition news, shares in Olam closed 4 cents lower at USD 1.55 on Dec 18, 2020.