Chr. Hansen to sell Natural Colors business to EQT

By Jim Cornall contact

- Last updated on GMT

Natural Colors' products are primarily used within F&B applications.  Pic: Chr. Hansen
Natural Colors' products are primarily used within F&B applications. Pic: Chr. Hansen

Related tags: Chr hansen, colors

Chr. Hansen Holding A/S and the EQT IX fund have announced EQT has agreed to acquire the Natural Colors Division, a subsidiary of Chr. Hansen, at a cost of €800m ($931m).

Headquartered in Hørsholm, Denmark, Natural Colors is a developer and manufacturer of natural coloring ingredients, serving more than 1,600 customers in the food and beverages industry. The Natural Colors division employs approximately 650 people and has grown organically by around 9% per annum during the past five years up to 2018/19. The Company generated sales of €224m ($261m) in 2018/19.

Natural Colors’ products are made from all-natural fruit and vegetable concentrates from sweet potatoes, grape skin, spirulina, carrots and beetroots. The products are primarily used within F&B applications where the conversion from artificial to natural colorants is highest, such as dairy- and fruit preparations, confectionery, ice cream, prepared foods and beverages.

Natural Colors’ underlying market is supported by trends such as increasing consumer awareness around health and the environment, the ongoing transition from synthetic components to natural ingredients, and a growing demand for sustainable and plant-based food.

EQT said it intends to build on the existing strategy of continued organic growth in current markets with a focus on the US and Asia. EQT will also support acquisitive expansion within the fragmented foods coloring market by utilizing the Natural Colors platform for industry consolidation. It said it plans to invest in the company’s organization and strengthen its digital infrastructure, sustainability capabilities and supply chain setup.

Mauricio Graber, CEO of Chr. Hansen, said, “The divestment of the Natural Colors Division completes the review part of our recently launched 2025 Strategy. Chr. Hansen can now focus on fulfilling the ambition of becoming a pure-play, microbial and fermentation company with industry leading, profitable growth. I am convinced EQT will be a great owner of the Natural Colors business which has a leading global position in the industry. During the process it has become clear that EQT showed the strongest conviction in the potential of the business, and the highest dedication to the future development of it. I want to thank all the employees of the Natural Colors business for their contribution to Chr. Hansen over many years and wish them all the best in the future journey as an independent company.”

Mads Ditlevsen, partner at EQT Partners, and investment advisor to EQT IX, said, “We are immensely proud and humble of having been chosen as the future owner of Natural Colors. It is a high-quality and truly global business with a proud legacy of servicing customers all over the world for more than 100 years. We are highly impressed by the strong ESG profile, the high-quality organization and talented people we have met during this process, as well as the dedicated focus on food safety. Natural Colors fits very well with EQT’s thematic investment criteria and is operating in two of EQT IX’s five prioritized sub-sectors within Industrial Technology. EQT’s ambition is to help the business achieve further growth both organically and through acquisitions.”

Klaus Bjerrum, executive vice president of Natural Colors Division, said, “I am very pleased to announce EQT as the new owner of Chr. Hansen’s Natural Colors Division. EQT has acquired our great business (pending closing) to grow it organically and inorganically based on our capabilities and organization, and not least our leading market position. It is my conviction that this marks a new and exciting chapter for us, and I am excited to embark on this journey with EQT and all our talented employees around the world.”

The transaction, subject to customary conditions and regulatory approvals, is expected to close in H1 2021.

Related topics: Ingredients

Related news

comments

Post your comment

We will not publish your email address on the website

These comments have not been moderated. You are encouraged to participate with comments that are relevant to our news stories. You should not post comments that are abusive, threatening, defamatory, misleading or invasive of privacy. For the full terms and conditions for commenting see clause 7 of our Terms and Conditions ‘Participating in Online Communities’. These terms may be updated from time to time, so please read them before posting a comment. Any comment that violates these terms may be removed in its entirety as we do not edit comments. If you wish to complain about a comment please use the "REPORT ABUSE" button or contact the editors.

Follow us

Products

View more

Webinars