AAK said the buy, for an unspecified amount, would help it, “strengthen its geographical footprint”.
The family-run Colombian firm produces edible oils and bakery margarines using palm oil as the main raw material and has been a member of the Roundtable on Sustainable Palm Oil (RSPO) since 2012.
Octavio Díaz de León, president of AAK’s Northern Latin America division, said: “This acquisition will reinforce AAK’s speciality oils and fats strategy and offers a strong foothold in Colombia, the third largest GDP in Latin America.”
AAK said its new firm – which has a plant in Villavicencio and is head-quartered in the Colombian capital of Bogotá – appealed because of its high local market penetration through direct customer relationships and strong independent distributors.
The Colombian company has 155 employees, an annual volume of 30,000 tonnes and reported revenues of around $40m last year.
Díaz de Leónsaid said FANAGRA showed “significant potential” to grow and emerge as an important player on the Colombian industrial market.
Arne Frank, president and CEO of AAK Group, said: “The acquisition is an integral part of our company program AAKtion. It strengthens our presence in another fast-growing economy in the strategically important bakery market.”
In January this year AAK launched its ‘AAKtion’ initiative for the 2014-2016 period, which it said entail structural and management changes enabling it to strengthen its focus on markets like Asia. FANAGRA is the latest in a flurry of buys for AAK - following Belgian CSM Benelux and Turkish Unipro from Unilever earlier this year. Also this year, the firm announced plans to invest $62m in a plant in Brazil.
The fats firm already has production facilities in Denmark, Mexico, the Netherlands, Sweden, the UK, Uruguay and the US.
Frank added: “It will also serve as a platform for increased sales of speciality and semi-speciality products within dairy as well as chocolate and confectionery fats in Colombia and Northern Latin America.”
The impact of the acquisition is expected to be reflected fully in AAK’s operating profit starting January 2015, with a slightly dilutive effect on EBIT per kilo for its food ingredients division. The firm said more information on the buy out would be available in its 2014 second quarter interim report in July.