Degussa food ingredients for sale
13thOctober 2004
Degussa announced today the intention to sell their food ingredients division. Degussa is one of the major players in the hydrocolloids world with well known products in area of pectin, carrageenan and xanthan gum. The official statement reads:
"Seen from the present perspective, the Food Ingredients Business Unit is too small to be developed into a worldwide leading market position through its own efforts. Degussa is therefore pursuing the strategy of enabling the unit to take advantage of optimum development opportunities through the participation of a suitable partner. Nor, as of today, is the sale of the unit excluded."
We suspect some of the newer entrants in the hydrocolloids world will be looking to consolidate their position with likely candidates including Kerry Foods, J M Huber and possibly Cargill and they will be looking closely at Degussa.
Over the past few years the hydrocolloids landscape has changed beyond all recognition. CP Kelco where shifted from pillar to post, split up and merged and are now part of the Huber group. Danisco have been acquiring companies including the ingredients business from Rhodia and now we have a new announcement that Degussa for sale before the dust has settled on the last deal (Citrico goes into liquidation)... and these are all major players. Its probably true to say that the bulk of the worlds hydrocolloids business has been sold at least once over the last few years. Resulting in a whole new set of key players emerging. The question is "is the landscape stabilsing or are more tremors likely in the near future"?