Orkla buys 84 percent of the American ice cream ingredient company – E24

Denali Ingredients is valued at NOK 2.2 billion.

Orkla Food Ingredients (OFI) has entered into an agreement to buy 84 percent of the American ice cream ingredients company, the grocery giant Orkla reports in a press release on Monday.

Denali Ingredients is valued on a debt-free basis at USD 200 million, which corresponds to around NOK 2.2 billion, according to the report. 84 percent of 2.2 billion is around NOK 1.85 billion.

– With this purchase, OFI strengthens its position as a leading supplier of ingredients to the ice cream and chocolate industry, in addition to the bakery industry. We have a stated strategy to increase exposure to markets and categories with higher growth and margins. Denali Ingredients, with its leading position in the attractive American market, fits well into this picture, says Johan Clarin, executive vice president and head of OFI, in the press release.

Denali Ingredients has its headquarters, two factories and 160 employees in the US state of Wisconsin.

The company has an expected turnover of 99 million dollars (1.1 billion kroner) for the financial year 2022, which runs until 30 September, according to Orkla. Normalized ebitda is expected to be USD 14.4 million (NOK 156 million, according to the report).

– We are very happy to now become part of OFI, which is already a significant player within Denali’s categories in Europe and with a deep understanding of our industry, says Neal Glaser, CEO of Denali Ingredients, in the press release.

In addition to the purchase price, the acquisition agreement contains a potential additional payment delivering strong growth in the coming years.

In addition to the acquisition of Denali Ingredients, Orkla has started looking for a long-term partner for OFI, with the aim of increasing value creation and the rate of growth. In the long term, a stock exchange listing may also be relevant, the company states.