IFF divests Food Ingredients unit to CVC Capital Partners for USD 4.3B
This transaction creates substantial value for shareholders while positioning IFF to drive sustained, profitable long-term growth.
USA – International Flavours & Fragrances (IFF) has entered into a definitive agreement to sell its Food Ingredients business to funds advised by CVC Capital Partners, a leading global private markets manager, in a transaction that values the business at USD 4.3 billion, representing an enterprise value-to-EBITDA multiple of roughly 10x.
This sale marks a pivotal strategic realignment for IFF, as the company shifts away from its largest revenue-generating division to focus exclusively on higher-margin, high-growth core segments.
The transaction will deliver approximately USD 3.8 billion in net cash proceeds at closing, which IFF plans to deploy for debt reduction, authorized share repurchases, and reinvestment in its core businesses.
IFF will retain a 10% minority equity interest in the divested Food Ingredients business, valued at approximately USD 200 million, and will maintain a board seat to continue collaboration while allowing IFF and its shareholders to participate in future value creation under CVC’s ownership.
The deal is expected to close by the end of the second quarter of 2027, subject to regulatory approvals and customary closing conditions, with JPMorgan and Bank of America serving as financial advisors to IFF.
Erik Fyrwald, CEO of IFF, 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 Food Ingredients business, despite generating nearly USD 3.1 billion in annual sales and approximately USD 430 million in EBITDA in 2025, operated on the lowest profit margin among all IFF segments at just 12.9%, compared to 19.3% for Taste, 20.8% for Scent, and 26% for Health & Biosciences.
The Food Ingredients division accounted for roughly 30% of IFF’s total sales and 20% of EBITDA, but sales declined by 3% in 2025 due to weaker performance in protein ingredients and the company’s decision to discontinue low-profit products.
Following the divestiture, IFF will concentrate exclusively on three core segments: Taste, which delivers flavours for food and beverage applications; Scent, which provides fragrances for consumer and industrial products; and Health & Biosciences, which offers probiotics, enzymes, cultures, and bioactives.
In recent years, IFF has implemented decisive measures to streamline its portfolio, hone its strategic focus, and fortify its financial foundation. With this latest transaction, the company has now divested 13 non-core businesses, collectively generating nearly USD 10 billion in gross proceeds.
These funds have been instrumental in strengthening IFF’s balance sheet while enabling strategic reinvestment into its highest-return business segments.
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