Business Concentrates ADM adds a dash of citrus
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Ag giant indulges taste for flavor specialties with deal for Florida Chemical In contrast, ADM plans to take advanAgribusiness giant Archer Daniels Midtage of Florida Chemical’s supply chain land has agreed to purchase Florida and processing expertise to expand its Chemical, a division of Houston’s Flotek offerings to the high-margin food and Industries, for $175 million in cash. beverage market. In that realm, the ingreFlorida Chemical is a large producer of dients are valued for their clean citrus oils and other citrus-deHO label attributes and ability to rived ingredients. modify flavors in reduced-sugar Those ingredients are in high products. demand, according to ADM. “CitIn addition to d-limonene, rus is one of the fastest-growing α-Perpineol Florida Chemical sells essential flavor categories and the single oils made from oranges, grapemost important taste profile for fruits, tangerines, limes, and lemons. It beverages,” says Vince Macciocchi, presialso sells purified citrus isolates such as dent of ADM’s nutrition business. α-pinene, myrcene, and α-perpineol. The terpene α-perpineol smells similar to lilac and is used in perfumes, cosmetics, and flavors. In 2014, ADM gained a large natural flavors portfolio and research expertise with the $3.1 billion acquisition of the Swiss firm Wild Flavors. At the time, Wild was the sixth largest flavor and fragrance company in the world. Last year, ADM acquired Colorado-based Rodelle, a supplier of vanilla and other natural flavor products. With that deal came a stake in a vanilla farmer association in Madagascar. ADM has also bought up plant protein and probiotic ingredient businesses. Florida Chemical’s products are made As is the case with vanilla, the supply from citrus. chain for citrus ingredients can be plagued by shortages and volatile prices. The indusFlotek, an oilfield chemical firm, actry is currently threatened by citrus greenquired Florida Chemical in 2013. The ing disease, a bacterium that destroys fruit. two may seem like an odd fit, but Flotek And last winter, Hurricane Irma resulted had been a big buyer of citrus-based solin the worst year for Florida’s orange crop vents, such as d-limonene, from Florida since 1945.—MELODY BOMGARDNER Chemical.
BY THE NUMBERS
76% Proportion of chefs surveyed by the National Restaurant Association who named food and drink infused with cannabidiol or other cannabinoids as the two top food trends for 2019. The chefs said the ingredients “could create unique cuisine opportunities and potential new markets for experiential dining occasions.”
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C&EN | CEN.ACS.ORG | JANUARY 21, 2019
FINANCE
Start-up funding breaks records Last year was a good one for start-ups seeking financing, and it was an especially good year for firms in pharmaceuticals and biotechnology. Venture capitalists sank $131 billion into US-based start-ups in 2018; pharma and biotech start-ups attracted $17.4 billion, or 13.3% of the total. Both sums set records, according to the National Venture Capital Association and PitchBook, a financial data–crunching firm. Total venture investment in 2018 broke the $100 billion high set during the dot-com boom in 2000. And the pharma and biotech category easily broke the record it set last year, when firms raised $11.8 billion. Overall, venture investors struck 8,948 funding deals in 2018. By far, the largest category was software, which accounted for nearly 42% of all deals. A miscellaneous category came in second with 1,973 deals, followed by the pharma and biotech sector with 720. Most categories saw a modest decline in the number of deals completed in 2018 compared with 2017. But the pharma and biotech sector experienced a 6% increase in deals. Large corporations significantly increased their participation in support of start-ups in 2018. These strategic players invested in 172 pharma and biotech deals last year, up 19% from the year before. And the value of those deals rocketed by 75% to $10.2 billion. The National Venture Capital Association suggests at least one reason for the big increase in corporate venture investments: last year’s tax cuts boosted corporate coffers, leading to a large number of outsize financings.—MARC
REISCH
C R E D I T: S H UT T E RSTO CK ( BOT H)
FOOD INGREDIENTS
