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IFF to Optimize Portfolio With Its Food Ingredients Business Sale
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Key Takeaways
IFF agreed to sell its Food Ingredients business to CVC Capital Partners for $4.3 billion.
IFF expects $3.8 billion in net cash proceeds for debt reduction, buybacks and growth investments.
IFF says that the sale sharpens focus on higher-growth businesses and supports long-term growth goals.
International Flavors & Fragrances Inc. (IFF - Free Report) announced that it inked a deal with CVC Capital Partners to sell its Food Ingredients business. The deal is in sync with International Flavors’ portfolio transformation strategy, which is expected to solidify its focus on its innovation-driven businesses.
IFF’s Benefits From the Deal
The Food Ingredients business generated $3.1 billion in 2025 with $430 million of EBITDA. The deal values the business at $4.3 billion, which represents an enterprise value of about 10X its EBITDA. International Flavors has decided to retain around 10% minority equity interest in the business to allow its shareholders to participate in future value creation under its new ownership.
At closing, International Flavors will receive net cash proceeds of $3.8 billion. The company aims to use the cash proceeds for debt reduction, targeted share repurchases, and reinvestment in high-return growth and high-return opportunities across the core portfolio.
IFF expects the deal to close by the end of the second quarter of 2027, subject to closing conditions.
International Flavors’ Focus on Portfolio Transformation
IFF has been actively simplifying and sharpening its portfolio over the past several years. The sale of the Food Ingredients business marked the divestment of 13 non-core businesses for International Flavors. These sales generated about $10 billion in gross proceeds, supporting the company’s balance sheet improvement.
The sale of the Food Ingredients business will help International Flavors concentrate resources on its higher-growth, higher-margin segments. The company will center its operations around three industry-leading businesses that target high-growth markets, driven by global trends in health, well-being, food and sustainability.
The company expects long-term revenue growth in the mid-single digits and adjusted EBITDA growth in the high-single digits. The upside will be driven by the differentiated and innovation-led nature of its core business.
IFF Stock’s Price Performance
In the past year, the company’s shares have gained 2.9% compared with the industry’s growth of 3.3%.
Image Source: Zacks Investment Research
International Flavors’ Zacks Rank & Stocks to Consider
Albemarle has an average trailing four-quarter earnings surprise of 74.5%. The Zacks Consensus Estimate for the company’s 2026 earnings is pegged at $12.45 per share, indicating year-over-year growth from a loss of 79 cents. ALB shares have skyrocketed 203.1% so far this year.
The Zacks Consensus Estimate for Air Products and Chemicals’ current-year earnings is pegged at $13.20 per share, indicating a 9.7% year-over-year rise. APD has an average trailing four-quarter earnings surprise of 2.9%. Air Products and Chemicals’ shares have gained 10.1% in a year.
Avino Silver has an average trailing four-quarter earnings surprise of 125%. The Zacks Consensus Estimate for Avino Silver’s 2026 earnings is pegged at 39 cents per share, indicating 34.5% year-over-year growth. Its shares soared 113.4% in a year.
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IFF to Optimize Portfolio With Its Food Ingredients Business Sale
Key Takeaways
International Flavors & Fragrances Inc. (IFF - Free Report) announced that it inked a deal with CVC Capital Partners to sell its Food Ingredients business. The deal is in sync with International Flavors’ portfolio transformation strategy, which is expected to solidify its focus on its innovation-driven businesses.
IFF’s Benefits From the Deal
The Food Ingredients business generated $3.1 billion in 2025 with $430 million of EBITDA. The deal values the business at $4.3 billion, which represents an enterprise value of about 10X its EBITDA. International Flavors has decided to retain around 10% minority equity interest in the business to allow its shareholders to participate in future value creation under its new ownership.
At closing, International Flavors will receive net cash proceeds of $3.8 billion. The company aims to use the cash proceeds for debt reduction, targeted share repurchases, and reinvestment in high-return growth and high-return opportunities across the core portfolio.
IFF expects the deal to close by the end of the second quarter of 2027, subject to closing conditions.
International Flavors’ Focus on Portfolio Transformation
IFF has been actively simplifying and sharpening its portfolio over the past several years. The sale of the Food Ingredients business marked the divestment of 13 non-core businesses for International Flavors. These sales generated about $10 billion in gross proceeds, supporting the company’s balance sheet improvement.
The sale of the Food Ingredients business will help International Flavors concentrate resources on its higher-growth, higher-margin segments. The company will center its operations around three industry-leading businesses that target high-growth markets, driven by global trends in health, well-being, food and sustainability.
The company expects long-term revenue growth in the mid-single digits and adjusted EBITDA growth in the high-single digits. The upside will be driven by the differentiated and innovation-led nature of its core business.
IFF Stock’s Price Performance
In the past year, the company’s shares have gained 2.9% compared with the industry’s growth of 3.3%.
International Flavors’ Zacks Rank & Stocks to Consider
IFF currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the basic materials space are Albemarle Corporation (ALB - Free Report) , Air Products and Chemicals, Inc. (APD - Free Report) and Avino Silver & Gold Mines Ltd. (ASM - Free Report) . ALB sports a Zacks Rank #1 (Strong Buy) at present, and APD and ASM carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Albemarle has an average trailing four-quarter earnings surprise of 74.5%. The Zacks Consensus Estimate for the company’s 2026 earnings is pegged at $12.45 per share, indicating year-over-year growth from a loss of 79 cents. ALB shares have skyrocketed 203.1% so far this year.
The Zacks Consensus Estimate for Air Products and Chemicals’ current-year earnings is pegged at $13.20 per share, indicating a 9.7% year-over-year rise. APD has an average trailing four-quarter earnings surprise of 2.9%. Air Products and Chemicals’ shares have gained 10.1% in a year.
Avino Silver has an average trailing four-quarter earnings surprise of 125%. The Zacks Consensus Estimate for Avino Silver’s 2026 earnings is pegged at 39 cents per share, indicating 34.5% year-over-year growth. Its shares soared 113.4% in a year.