Frutarom signs algae products investment contract

Flavours and specialty natural ingredients company, Frutarom Industries has signed an investment contract with Algalo Industries to gain exclusive marketing rights for algae products across the globe.

Israel-based Algalo Industries is a start-up working on biotechnology and has developed a method for the cultivation, harvesting and processing of a wide range of algae that produces active ingredients to be used in the dietary, food and clinical nutrition supplements, and cosmetics industries.

These algae include strong antioxidants, proteins, lipids and carotenoids that maintain cardio-vascular health, a strong immune system, and healthy skeletal and bone structure.

Frutarom will invest approximately US $2.6m in exchange for the allocation of 50% of Algalo’s shares to build a modern biotechnology facility.

Frutarom Group president and CEO Ori Yehudai said: "The investment in Algalo is part of a broad strategic move by Frutarom to reinforce its position and standing as a leading and innovative global supplier of natural specialty products and functional food ingredients in the fields of taste and health which already now make up over 75% of Frutarom’s activity.

"The technology developed by Algalo for cultivating, harvesting and processing algae expands Frutarom’s internal research and development capabilities for producing active ingredients from algae, a field in which we are already active, and provides an innovative platform and an additional growth engine for expanding Frutarom’s diverse product portfolio in the growing field of natural specialty ingredients.

"We will work towards leveraging the cross-selling opportunities arising from this investment by expanding Frutarom’s product portfolio and technological abilities and by presenting Algalo’s innovative products to our thousands of customers worldwide."

Algalo and Frutarom collaborate to cultivate algae and produce active ingredients like polysaccharides that are used by some renowned cosmetics companies in their skin care and protection products.

Frutarom serves more than 150 countries, selling its products to over 20,000 customers, including leading global companies in foods and beverages, nutritional supplements, pharmaceuticals and cosmetics.

Yehudai also said: "The size of the algae-based ingredient market is estimated to be hundreds of millions of dollars and has enjoyed double-digit growth over recent years.

Frutarom operates in the global flavours and natural fine ingredients markets.