In a strategic move within the food manufacturing sector, international agricultural processor and merchant Louis Dreyfus Company (LDC) has entered into a binding agreement to acquire BASF’s Food and Health Performance Ingredients business.
Headquartered in Rotterdam, Netherlands, LDC operates in over 100 countries across 180 locations. With this acquisition from BASF, LDC will integrate a production site and R&D center in Illertissen, Germany, as well as three additional application labs located outside of Germany.
BASF’s Food and Health Performance Ingredients division encompasses various food performance ingredients, including aeration and whipping agents, food emulsifiers, and fat powder grades. It also features health ingredients like plant sterols esters, conjugated linoleic acid (CLA), and omega-3 oils for human nutrition, along with several smaller product lines.
BASF acknowledged that its Food and Health Performance Ingredients portfolio is essential for addressing emerging trends in human nutrition. However, the company stated that this business lacks sufficient synergies with its core operations, ultimately leading to its decision to pivot away from this area.
“Building on our teams’ success in developing this business over the past years, LDC as a future-oriented company can offer our employees and portfolio a promising perspective,” stated Michael Heinz, member of the board of executive directors at BASF and head of the Nutrition & Health division.
“The divestment of this business to LDC supports our strategic portfolio optimisation and allows us to focus on our core businesses in Nutrition & Health. We remain committed to leveraging our core product platforms while expanding our business in critical areas such as vitamins, carotenoids, and feed enzymes.”
Through this acquisition, LDC plans to harness its existing expertise in oils, fats, glycerin, and lecithin, as well as its robust global supply chains, to enhance its positioning in nutritional and functional ingredients.
“In line with our strategic plans for revenue diversification through more value-added products and growth in downstream markets, this agreement presents an opportunity to accelerate LDC’s participation in the rapidly growing plant-based ingredients market,” added Michael Gelchie, CEO of LDC.
As part of the transition, approximately 300 employees are expected to transfer from BASF to LDC upon the closing of the transaction.
“We are excited about the prospect of this transaction, as LDC’s first investment in dedicated facilities to produce food and health performance ingredients at scale,” Gelchie emphasized.
This agreement is contingent upon regulatory approvals and customary closing conditions.
