Xinhua is one of the leaders in aroma chemical manufacture, with an established history of quality production; and Givaudan hopes this will stand it in good stead to make its mark in the region.
“This joint venture is another step forward in our global strategy to get closer to customers in developing markets; Xinhua is perfectly positioned to partner with Givaudan in Asia Pacific,” says Gilles Andrier, CEO.
The fragrance firm says that the agreement is an additional step in its strategy to reinforce its position in developing markets to meet the growing demand in the region, and improve its competitive position on a selected portfolio of products.
A company statement reveals that some ingredients currently produced at existing Givaudan sites will be transferred to the joint venture.
Transfers will be done progressively over the coming years alongside continued investment in the long-term competitiveness and continuous improvement of existing sites.
It is not the only business activity concerning Givaudan in the last few weeks. At the end of February it was revealed that it had entered exclusive negotiations to acquire French manufacturer, Soliance, as it aims to step further into the skin care segment.
If all goes to plan, Givaudan says it will be carrying out the transaction with an aim to build upon its existing active cosmetic ingredients business and enhance its current portfolio, including the fragrance division's work with natural molecules.
Accordingly, it will be Givaudan's first acquisition since 2006, when it bought flavours-and-fragrance maker Quest International.
Michael Carlos, president of Givaudan’s fragrance division, says that the brand expects Soliance to become an integral part of its fragrance division and to bring significant contributions over the next few years, particularly in the research and development area.
The transaction is expected to close in the second quarter of 2014, subject to the customary closing approvals and conditions, which includes consultations with the employee representative bodies.