Louis Dreyfus Acquires BASF Food Business for $300 Million

According to a joint statement from both companies, Louis Dreyfus is acquiring the food and health performance ingredients business of German chemicals manufacturer BASF. Although the financial terms of the deal have not been disclosed, the acquisition involves the production facilities and R&D capabilities of the BASF division, including a production and R&D facility in Germany and three laboratories. As part of the transaction, approximately 300 BASF employees will transfer to Louis Dreyfus's business unit.

As consumer demand for healthier ingredients increases, producers in the food sector are continually expanding their product offerings. This acquisition will help companies like Louis Dreyfus enrich their product lines, thereby enhancing their appeal to customers. As a major player in the food ingredients and agricultural markets, Louis Dreyfus believes this acquisition will expand its influence in the global plant-based food sector. In a press release, the company emphasized that BASF's portfolio of fats, glycerol, and lecithin products are key assets in this transaction.

James Zhou, Chief Commercial Officer of Louis Dreyfus, stated, “We see tremendous potential for Louis Dreyfus to evolve from a reliable raw material supplier to a trusted solutions partner, working with our global customers to develop appealing applications, including baking and confections, non-dairy products, convenience foods, personal care, and healthcare.”

For BASF, this sale will provide the company with room to focus on other business areas. BASF stated that its plant-based division is no longer a “strategic focus area” and that there are limited synergies within the business. BASF Executive Board member Michael Heinz remarked, “We remain committed to leveraging our core product platforms and expanding our business in key areas such as vitamins, carotenoids, and feed enzymes.”

In recent years, the plant-based meat market has faced challenges, with companies like Beyond Meat and Impossible Foods laying off employees, adjusting marketing strategies, and prioritizing innovation. The divestiture of BASF's assets helps improve its cash flow by shedding a struggling business category. Meanwhile, Louis Dreyfus has increased its presence in the protein ingredient sector in recent years. Last summer, the Netherlands-based company established a dedicated business unit focusing on legume products, such as beans and lentils. Earlier in 2024, the company announced plans to build a pea protein factory in Canada.