BASF sells food and health functional ingredients business to Louis Dreyfus Company

BASF has signed a binding agreement to sell its food and health functional ingredients business, including the production site in Illertissen, Germany, to Dutch agricultural product trader and processor Louis Dreyfus Company (LDC).

BASF said the business is no longer a strategic priority for BASF due to limited synergies and integration with the group's business. Financial details of the transaction have not been disclosed.

According to the agreement, approximately 300 employees are expected to transfer from BASF to Louis Dreyfus after the transaction is completed. BASF said the transaction will not affect the continuity and reliability of supply and business relationships.

Michael Heinz, Member of the Executive Board of BASF and Head of Nutrition & Health, said: “Over the past few years, our team has successfully developed this business and LDC is a future-oriented company with bright prospects for our employees and portfolio. The transfer of this business to LDC helps us optimize our strategic portfolio and allows us to focus on our core business in Nutrition & Health. We remain committed to leveraging our core product platforms and expanding our presence in key areas such as vitamins, carotenoids and feed enzymes.”

Michael Gelchie, CEO of LDC, added: “This agreement is in line with LDC’s strategic plan to diversify its revenues by adding value-added products and developing downstream markets. It is also an opportunity to accelerate LDC’s participation in the fast-growing plant-based ingredients market. We are excited about the prospects of this transaction, which is LDC’s first investment in dedicated facilities for large-scale production of food and health functional ingredients.”

The Food & Health Functional Ingredients business includes food functional ingredients such as aerating and foaming agents, food emulsifiers and fat powders; health ingredients such as plant sterol esters, conjugated linoleic acid (CLA), omega-3 oils for human nutrition and some smaller product lines.

The transaction is subject to customary closing conditions, including receipt of relevant regulatory approvals.