Flavor and fragrance oligopoly
The flavor of everything from Big Macs to mouthwash is a product, in some measure, of a small number of specialty chemical companies. The same companies are responsible for the smell of everything from designer perfumes to laundry detergent. These companies have an enormous impact on the food, beverages, cosmetics, and household products, even though these are companies that few have ever heard of.
Flavors and scents are created both by extraction from natural products and by synthesis of key chemicals. It is likely, in fact, that your vanilla ice cream has never seen a vanilla bean, and it's a safe bet that your lime-scented shaving cream never came within miles of the fruit.
Total market in 2005 is around $16 billion, 65% of the worldwide business is in the top ten. 43% top four. This is by any terms an oligopoly. Some of the vendors are dedicated flavor and fragrance companies, while others are divisions of larger chemical companies.
Naturally, this segment is getting more concentrated through mergers and acquisitions. In 2003, for example, flavor and fragrance companies Dragoco and Haarman & Reamer merged to from Symrise, to become the #4 company in the sector. In 2002, Givaudan acquired Nestlé's FIS flavor holdings.
Other deals involving the top ten:
In 2000, IFF acquired Bush Boake & Allen to become the #1 flavors and fragrances company.
Pharmaceutical/chemical company Roche spun off Givaudan.
Danisco acquires US company Florida Flavors.
In 2002, Givaudan acquired International bioflavors of the US.
Firmenich acquired Bjørge Biomarin AS, a Norwegian specialist in seafood extracts.
Sensient Flavors acquired German-based Melchers Flavors.
Danisco bought Belgian flavoring company Perleron.
In 2004 Danisco acquired French Rhodia Food Ingredients.
In 2005, Firmenich acquired US perfume and flavor company Noville.
Symrise acquired UK company Flavours Direct.
In 2006, Symrise acquired Germany's Kaden Biochemicals GmbH.
Quest International, through its parent ICI, acquired US-based Shaw Mudge, a fragrance company.
Top ten flavor and fragrance companies
| Company |
Country |
2006 Income (millions $) |
Market share |
| Givaudan |
Switz. |
2,109 |
13.2 |
| IFF |
US |
1,993 |
12.4 |
| Firmenich |
Switz. |
1,784 (2004) |
9.8 (est) |
| Symrise |
Germany |
1,360 |
8.5 |
| Quest International |
Neth. |
964 |
6.0 |
| Takasago |
Japan |
898 |
5.6 |
| Sensient Flavors |
US |
516 |
3.2 |
| T. Hasegawa |
Japan |
406 |
3.5 |
| Mane SA |
France |
311 |
1.9 |
| Danisco |
Denmark |
279 (est.) |
1.7 (est) |
Source: Leffingwell & Associates
7:12:30 PM 
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