ADM Hits 2019 Running With Two Major Acquisitions and the Formation of a New Crop Origination Business

January 18, 2019

Despite ADM chief executive Juan Luciano saying that now is not the time for “monster acquisitions”, the company has indeed had a dynamic few weeks since the start of 2019, announcing not only two significant acquisitions, but the formation of ADM Agriculture Ltd. – a new business to strengthen the company’s presence in the UK.

Specialty Flavors

On January 11 ADM announced it had agreed to acquire Florida Chemical Company (FCC),  one of the largest providers of citrus flavors, oils, and ingredients in the world.

Founded in Winter Haven, Florida, in 1942 as a division of Flotek Industries, FCC produces a wide range of high-value citrus flavor ingredients, terpenes, and formulated products for the flavor, fragrance, and consumer products industries.

For ADM, the acquisitions adds a citrus facet to its ingredients and flavors portfolio, and expands its offerings with on-trend products that meet consumers’ desires for natural, low-sugar, clean labeled foods and beverages.

“ADM is already a leader in natural flavors for food and beverages, offering a wide variety of high-value products and solutions in areas such as vanilla and mint, and this acquisition will place us in a leadership position for citrus flavors as well,” said Vince Macciocchi, president of ADM’s Nutrition business unit. “Citrus is one of the fastest-growing flavor categories, and the single most important taste profile for beverages, and no one in North America does citrus better than Florida Chemical Company.”

FCC’s product lines include individual and customized citrus flavor blends and essential oils; flavor enhancers for grapefruit and other citrus; and flavor modifiers targeted to improve the quality and taste of foods and beverages.

“With the acquisition of WILD in 2014, ADM began the journey to become the world’s leading nutrition company,” said Vince Macciocchi, president of ADM’s Nutrition business unit. “Starting with the foundation of a leading global flavor company and our specialty ingredients portfolio, we’ve vastly expanded our capabilities with additions like the savory flavors of Eatem Foods, the plant proteins from Harvest Innovations, probiotics from Biopolis and Protexin, and Rodelle’s premium vanilla ingredients. The result is great for our customers and our shareholders: No other company in the world can match the expertise, innovation, products and solutions of ADM — and we’re still growing.”

Grains and Origination

Six days after announcing its acquisition of FCC, ADM announced that it had signed a deal with its partner – French co-operative InVivo, agreeing to acquire the remaining 50 percent it did not already own in British grain trader Gleadell Agriculture Ltd.

Founded in 1880, Gleadell is a top supplier of combinable crops to UK millers, feed compounders, and others. It is a major exporter of grains, oilseeds, and pulses to both EU and overseas markets, and is a certified supplier of seeds and fertilizers to UK farmers. The company also has port storage, pulse and seed processing and storage facilities, and ship loading operations.

Once the deal is complete, ADM plans to merge Gleadell and its wholly owned subsidiary Dunns (one of the oldest agricultural businesses in the UK) with ADM Arkady, its UK destination marketing business, and ADM Direct UK, its specialist crop origination business to create the new entity – ADM Agriculture Ltd.

“With significant storage and processing capability and a longstanding reputation for being a safe and trusted trading partner, Gleadell and Dunns will be great additions to our business in the UK,” said Gary McGuigan, ADM’s president of Global Trade. “We are excited to expand our capabilities, not only to continue our strategic growth, but also to support our farmers and our customers as they work to address fast-growing consumer demand.”

-Lynda Kiernan

Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.com.

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