MEDICAL DEVICES PHARMACEUTICALS CHEMICALS FOOD & BEVERAGE ELECTRONICS

THE TOP TEN WORLD’S LEADING FLAVOR AND FRAGRANCE COMPANIES

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INTRODUCTION

"The Top 10 World's Leading Flavor and Fragrance Companies" is Venture

Planning Group's annually-updated report on performance, capabilities and strategies of

the major competitors in the flavor and fragrance industry worldwide.

In addition to primary information sources, the report includes data retrieved from

VENTURE PLANNING GROUP's proprietary files, which contain current information on

major flavor and fragrance companies, technologies, products and executives. These files

have been developed in the course of the firm's continuous monitoring of the flavor and

fragrance industry, over 100 previous syndicated studies, and numerous single-client

assignments.

Moreover, a comprehensive review of the TOP 10 companies' product and financial

literature, business and technical periodicals, and pertinent industry analyst reports was

conducted.

We trust that this report will help current suppliers, companies planning to enter the

flavor and fragrance market, and the financial community to assess competitive

environment, identify emerging opportunities and develop successful business expansion

strategies.

MARKET OVERVIEW

I. The Bimodal Trend

The concept of a bimodal trend, i.e., a concurrent consolidation and

decentralization in the flavor and fragrance industry, was first presented in the VPG

Top 10 report in 1988. The reality of a developing industry where the concentration

of business would result in 3-5 global mega-firms that could generate the sales

volume necessary to support the services demanded by global customers has been

accepted by most in the industry and has been born out by the events that have

place since 1988. The bimodal trend still continues. Due to intense competition,

there is currently only room for five major international firms that are capable of

offering the global customer a full range of services and products in all areas of

flavors, fragrances, synthetic and natural aroma chemicals, and essential oils on a

global scale. Most critical is that this sales volume must be attained with flavor and

fragrance products in order to ensure the image, contracts and dedication

(currently, many companies have significant sales volumes from outside the flavor

and fragrance industry, resulting in conflicting cultures and internal competition,

which can reduce the company's ability to compete).

In 2010, the flavor and fragrance market is estimated at $24.5 billion.

The Top 10 flavor and fragrance firms combined sales accounted for over 60% of

the world market. Several large customers have streamlined their XXXXXXXX

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TABLE MO-2

WORLD FLAVOR AND FRAGRANCE MARKET GROWTHBY PRODUCT CATEGORY

2010-2015($ billions)

Annual Growth2010-2015

Geographic Region Percent Percent (%)2010 Of Total 2015 Of Total

Flavors

Fragrances

Aroma Chemicals

Essential Oils

Total

flavors, with four technical persons.

In Tokyo, Japan, the company has established a mini-technical center

serving the local market and staffed with one flavorist and one perfumer.

In Singapore, Firmenich opened a new manufacturing facility for the

production of flavor and fragrance compounds as well as beverage essential oils, in

addition to a mini-creative center. This site now operates as a main base with three

perfumers and four flavorists.

In China, Firmenich has two main facilities. The joint venture (in which the

company owns a major share), near Shanghai produces fragrances for all types of

applications. Suzhou Firmenich Aromatics has a staff of XX and a perfume

production capacity of 1200 mtons per year. In Yunnan province in the south,

Kunming Firmenich Aromatics employs XXX persons and produces essential oils

and their isolates.

In Sao Paulo, Brazil, the company produces fragrances for the local market

in a joint venture facility with Givaudan and Amway. In 2010, the company opened a

new flavor development center.

In India, Firmenich entered a joint venture with its former agent for the

production of flavors, fragrances and aroma chemicals. The construction

progressed on a new perfume ingredient plant that is set to start production soon.

In 2010, the company opened a new perfume ingredients plant in Gujarat Province.

In February 2010, Firmenich opened a new affiliate in Dubai, UAE.

Firmenich employs an estimated XXXX persons in over XX locations

Givaudan has been refocusing its ingredients portfolio toward higher value

added aroma chemicals used as captive ingredients in perfumery and sold as

proprietary specialties.

An extensive aroma chemical product line had always been Givaudan's

strength. However, the competition in the aroma chemicals market has become

intense and the profit margins eroded. As a result, the company has been de-

emphasizing the aroma chemical business and has been selling through Vigon

(East Stroudsburgh, PA). Vigon has been marketing Givaudan’s line of flavor and

fragrance basic ingredients, including the citrus ingredients produced at the

Lakeland, FL site. Most of the domestic distribution of these products are handled

by this division.

C. Specialties

Givaudan manufactures a limited line of high-volume specialties for many of

which the patent protection has expired. The specialties offered by the company

include: Givescone, Trans-Decenal, Undecavertol, Lime oxide and vaniprox and

several others.

Givaudan's traditional research and development efforts in the specialties

have been focused on fungicides, emulsifiers and improved Lillial processes (in

Switzerland), all large-volume products aimed at customers and uses outside the

traditional fragrance and flavor industry.

In the area of flavors, where Givaudan had been relatively weak, specialties

were developed internally or acquired, including:

° Acetaldehyde Ethyl Butyrate Ethyl Propionate

TABLE G-5

GIVAUDANESTIMATED SALES GROWTH BY GEOGRAPHIC REGION/COUNTRY

2007-2010($ millions)

Annual Growth2007-2010

Geographic Region/Country 2007 2008 2009 2010 (%)

Europe

Asia-Pacific

North America

Latin America

Africa, Middle East

Switzerland

Total

X. STRATEGIC DIRECTION

Over the past thirty years, T. Hasegawa has moved from being a trading

goods supplier to a service-oriented flavor and fragrance house. In recent years,

the company has chosen to ignore its low-return market areas, such as fragrances

and consumer products, and has instead placed its assets into higher return

product lines. It has accomplished this without acquisitions and divestitures.

In the long term, T. Hasegawa is expected to continue expanding through

internal growth, without acquisitions. However, the company is relatively small to

make a transition to a mega-global supplier and become more than a niche player

with operations limited to Asia. On the other hand, the strength of the XXXXXXX

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The Shanghai industrial plant and the Chinese subsidiary T. Hasegawa C.

Ltd. (Shanghai) have further strengthen the company’s position in China. The plant

initially employed XX workers and the up-front investment was XXXXX yen. Sales of

both flavors and fragrances have been increasing in China, although the company

was anticipating that fragrances will perform better than flavors. A main rationale

behind the new Shanghai plant was to XXXXXXXXXXXXXXXXXXXXXXXXXXXXX

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V. MAJOR FACILITIES AND EMPLOYEES

Since its founding as a merger of Van Ameringen-Haebler and Polak &

Schwartz, IFF has been an American-Dutch firm, maintaining major research and

production activities in both the U.S. and Holland. Over the past twenty fi ve

years, IFF has changed from an American-Dutch firm to an American based

international firm with a global outlook. Instead of being primarily concentrated in

Holland, IFF currently operates in more than XX countries, and has approximately

XX sales offices in XX countries, or agents in the remaining parts of the globe.

The company maintains its own sales and distribution facilities in XX countries

and is represented by sales agents in other countries.

IFF has XX manufacturing facilities with major ones being located in the

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The restructuring included closing several facilities and reducing of the

workforce by 5%. The facilities closing resulted in an annual cost savings of

about $50 million.

The company, continuing its cost cutting efforts, closed or consolidated XX

facilities. IFF has lowered the number of its facilities by about half to date, from

over XX to about XX.

At the end of 2010, IFF employed about XXXX persons worldwide, distributed as

follows: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

beverages in the U.S.

The U.S. fragrance marketing organization consists of XX salespersons

operating from the New York City headquarters. The U.S. flavor sales force of

XX is located in South Brunswick, NJ. Additional U.S. sales offices with X

salespersons each are located in Chicago, IL and Los Angeles, CA.

Other major IFF sales offices include:

Brazil..........................................................................................................XX salespersons

China, Holland, Mexico, Spain ....................................................XX salespersons each

France, U.K. ......................................................................................X salespersons each

Australia, Canada, Indonesia .........................................................X salespersons each

South Africa................................................................................................X salespersons

Hong Kong, Argentina, Germany, India........................................X salespersons each

Jamaica, Japan, Malaysia, Philippines, Singapore,

Thailand, Venezuela .......................................................................X salespersons each

Denmark, Ghana, Holland, New Zealand, Nigeria,

Sweden and Zimbabwe .................................................................... X salesperson each

The company has additional sales offices in Chile, Columbia, Finland, Kenya,

Norway and Switzerland.

IX. STRATEGIC DIRECTION

Sensient is in the process of streamlining operations, rationalizing product

lines, improving customer service, and pursuing global expansion. The company is

attempting to accelerate the pace of new product development, and strengthen

sales and marketing capabilities.

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The company is focusing on globalization and expansion into fast-growing,

higher-margin non-food markets including cosmetics, nutraceuticals, skin creams

and other high-margin health and beauty products. Sensient has invested in

technology and research facilities and has been streamlining R&D operations.

The company has chosen to exit low return market areas, such as consumer

products, and move its assets into higher return product lines. The firm has

accomplished this by a policy of acquisition and divestment. Over the past forty

years the company's product mentality has changed from a consumer goods

producer supplying yeast and chili products, to a service-product oriented supplier

of goods of high return. Part of this policy is to invest in developing superior

products and services.

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TABLE SY-5

SYMRISEESTIMATED SALES BY PRODUCT CATEGORY

2010

Sales PercentProduct Category ($ millions) Of Total

Scent and Care

Fragrances

Cosmetics

Aroma Chemicals

Flavor and Nutrition

Flavors

Other

Total

TABLE T-5

TAKASAGO INTERNATIONALESTIMATED SALES GROWTH BY PRODUCT CATEGORY

2003-2010($ millions)

Annual Growth2003-2010

Product Category 2003 2004 2005 2006 2007 2008 2009 2010 (%)

Flavors

Fragrances

Fine Chemicals

Aroma Chemicals

Others

Total

TABLE CA-5

THE TOP 10 WORLD'S LEADING FLAVOR AND FRAGRANCE COMPANIESESTIMATED SALES FORCE SIZE BY GEOGRAPHIC REGION

2010

Company Europe/ North EMEA America Others World

FrutaromSymriseGivaudanIFFFirmenichSensientTakasagoT. Hasegawa

Total