ADM closes on flavor company purchase amid accounting probe
Reuters
Published Jan 31, 2024 05:08PM ET
By P.J. Huffstutter
CHICAGO (Reuters) - Global grains merchant Archer-Daniels-Midland Co on Wednesday closed on its purchase of Fuerst Day Lawson Ltd (FDL), a U.K.-based company that develops flavors and produces specialty ingredients for food-service customers in Europe, an ADM spokesperson told Reuters.
The deal, announced in December, is the latest move by ADM to expand its Nutrition segment, the same unit that is under scrutiny as the 122-year-old company faces a government inquiry and internal investigation.
Financial details of the FDL acquisition were not disclosed.
ADM officials declined to comment further on the deal. Officials with FDL did not return repeated requests for comment.
Shares of ADM last week plunged to their biggest daily drop since 1929, after Chief Financial Offer Vikram Luthar was placed on administrative leave and the company brought in outside lawyers to investigate accounting practices at its Nutrition segment.
ADM cut its 2023 profit forecast and said fourth-quarter results would be delayed due to the investigation related to certain intersegment transactions, in response to a voluntary document request by the U.S. Securities and Exchange Commission (SEC).
FDL's offerings include custom flavors for food manufacturers, as well as syrups, sauces, juice blends, botanical extracts and bakery ingredients, according to the company's web site. It operates five locations in the United Kingdom and had projected 2023 sales of approximately $120 million, ADM said in a statement when it announced the deal on Dec. 18.
The deal followed ADM's acquisition of Revela Foods, a Wisconsin-based developer and manufacturer of dairy flavor ingredients and solutions. The deal closed earlier this year, ADM told Reuters.
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