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Tianning deal completes as Kerry continues Asia push

By RJ Whitehead

- Last updated on GMT

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Tianning deal completes as Kerry continues Asia push
The purchase by Kerry Group of Chinese ingredients firm Tianning Flavours and Fragrance has gone through for an undisclosed price.

The 100% acquisition should significantly boost the Ireland-based company’s presence in the Chinese supply chain, not least through Tianning’s Shanghai plant, which has a total area of 20,000 square-meters. 

Tianning has become one of China’s biggest food ingredients players since it opened for business in 2005. It supplies domestic and international food and beverage customers with flavours and fragrances, and has a nationwide sales network with branch offices in Shanghai, Guangzhou, Wuhan, Zhengzhou and Shenyang.

That the deal has completed will please Kerry chief executive Edmond Scanlon, who succeeded Stan McCarthy at the helm in February. Scanlon relocated to Shanghai in 2012 to head the company’s business there, and was made chief executive of Kerry’s Asia-Pacific operations two years later.

It was speculated at the time of his elevation that Scanlon’s experience in Asia tipped the scales in his favour for the top appointment. 

Analysts have for some time singled out the Far East as a region that should be driving business. Business volumes there grew almost 11% last year—three times faster than the pace experienced by the wider group.

Emerging markets have grown from being worth around 19% of Kerry’s business in 2008 to 26% last year. This ration would probably have been higher if the company hadn’t focused on America for most of its €900m of takeover deals in 2015.

If you take a three- to five-year guess, Asia could be a much more significant part of our business​,” McCarthy, who left the business to retire, told analysts.

Though the price of the Tianning deal is unknown, the new chief executive’s erstwhile Asia-Pacific unit had agreed to spend €83m on two flavours and fragrance deals, in China and Australia.

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