At a Glance

  • Private equity firm CVC Capital Partners has announced it will acquire dessert and bakery ingredients supplier Irca from Advent, with the transaction amount undisclosed.
  • The deal for the Italian ingredients manufacturer is expected to close in the fourth quarter of this year, with CVC stating it plans to support Irca's growth ambitions in the U.S. and Europe.
  • This marks CVC's second deal involving an ingredients supplier in the past month. The private equity firm announced in late May that it would acquire IFF's ingredients business for $4.3 billion.

In-Depth Analysis

The acquisition of Irca, combined with the recent purchase of IFF's food ingredients business, immediately positions CVC as a major player in the ingredients sector, capable of serving a broad range of customers. IFF brings CVC expertise in specialty and clean-label ingredients, while Irca gives CVC access to the indulgent food and dessert segments.

Under Advent's ownership, Irca's revenue has grown from €370 million in 2021 to €1.5 billion (approximately $1.7 billion) today. Irca produces ingredients and semi-finished products for the global pastry, bakery, chocolate, and ice cream markets, serving customers in over 100 countries and operating a global manufacturing network of 19 plants.

Irca significantly strengthened its U.S. presence in 2023 through the acquisition of Kerry's sweet ingredients business, a deal that gave the Italian company four manufacturing plants in the U.S. Under Advent, Irca also acquired Italian pistachio ingredients company Anastasi Group and artisanal fruit ingredients company Cesarin SpA.

According to a press release, CVC plans to further grow Irca through additional acquisitions and continued international expansion. The deal brings CVC a broad customer base ranging from local bakeries and ice cream shops to large food manufacturers and foodservice operators.

"Irca combines a strong market position, a resilient business model, and significant opportunities for further international expansion," said Giampiero Mazza, Managing Partner at CVC, in a statement. "We will work with management to support the company's continued growth through operational excellence initiatives, selective acquisitions, and investment in its global platform."

CVC's acquisition is the latest deal to shake up the ingredients industry, as suppliers seek to capitalize on the wave of reformulation to meet consumer demand for premium products, functional ingredients, and minimally processed foods.

Other companies are also looking to expand their formulation capabilities through acquisitions. In recent months, Ingredion announced a $3.6 billion deal to acquire competitor Tate & Lyle, while Splenda parent Heartland Food Products agreed to acquire the Americas business of sweetener maker Whole Earth Brands.