Ingredion expands ingredients empire with $340m deal to buy Penford Corp

Sweeteners & starches giant Ingredion has expanded its ingredients empire with the acquisition of potato starch specialist Penford in a $340m deal that could close before the end of the year.

The Westchester, Illinois-based company, which broadened its portfolio with the $1.3bn acquisition of National Starch in 2010 and changed its name from Corn Products International to Ingredion in 2012, recently announced plans to invest $100m into increasing its manufacturing capacity for specialty ingredients from crops such as tapioca and rice, and has also launched several stevia-based products.

Ingredion chairman and CEO Ilene Gordon said the Penford deal would generate annual cost synergies of at least $20m, primarily from efficiencies in manufacturing, procurement, logistics and general and administrative functions. 

She added: “[Acquiring Penford] expands our higher-value specialty portfolio, establishes manufacturing of specialty potato starches in North America, and builds our presence in nature-based hydrocolloid ingredients.

"Penford's range of products addresses growing consumer trends, including nutrition, gluten-free, food textures, and sustainable green solutions.”  

Centennial, CO-based Penford operates six U.S. plants that make specialty starches - with a particular emphasis on potato starches. It also has a strong presence in gums & hydrocolloids following its acquisition of Gum Technology Corp. 

It posted revenues of $467m in 2013, while Ingredion notched up revenues of $6.3bn.