International Flavors and Fragrances to sell food ingredients unit in US$4.3 billion deal

Glass bottles and jars in a laboratory. IFF's business unit making emulsifiers, sweeteners and pastes, was its largest unit by revenue as of December 31, 2025, according to its annual report. (Ron Lach/Pexels)

International Flavors & Fragrances agreed to sell its food ingredients business to CVC Capital Partners in a deal that values the unit at about US$4.3 billion, as the flavour maker trims its portfolio to boost profitability.

IFF has been looking to sharpen its focus on fragrances and health businesses, as consumer spending on health and wellness remains resilient.

The company said it has divested 13 non-core businesses over the last several years and raised about US$10 billion in gross proceeds to help reinvest in its higher-margin businesses.

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Shares of the company were up about two per cent in premarket trading on Friday.

IFF has a market capitalization of about US$19.9 billion, according to LSEG data.

The company sold its pharma solutions business to French plant-based ingredients maker Roquette last year, in a deal valued at US$2.85 billion. It also sold its soy protein concentrates business to agribusiness company Bunge earlier this year.

IFF said it expects to receive about US$3.8 billion on closing the sale of its food ingredients business, and will direct the net cash proceeds towards debt reduction, share buybacks and reinvestments in its core portfolio.

The business, which makes emulsifiers, sweeteners and pastes, was IFF’s largest unit by revenue as of December 31, 2025, according to its annual report.

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Packaged food companies, which are major customers of IFF, are also streamlining businesses to cater to shifting trends, as shoppers trade down or opt for healthier alternatives. The growing adoption of appetite-suppressing weight loss drugs is also changing food habits.

Frank’s RedHot sauce maker McCormick agreed to merge with Hellmann’s mayonnaise owner Unilever’s food business in April. Days later, Unilever said it would buy U.S.-based nutritional supplements brand Grüns to sharpen its focus on wellbeing and beauty products.

The Wall Street Journal first reported on the IFF deal, which is expected to close at the end of the second quarter of 2027.

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Reporting by Juveria Tabassum in Bengaluru; Editing by Shinjini Ganguli