International Flavors & Fragrances Inc. (IFF), which last year bought the Israeli Frutarom for $7.1 billion, has determined the latter made illegal payments to "representatives of a number of customers" in Russia and Ukraine.
These facts were revealed during the integration of Frutarom, IFF said in its quarterly report, according to the Kyiv-based Interfax-Ukraine agency.
"IFF’s investigations are not yet complete, but preliminary results indicate that improper payments were made and that key members of Frutarom’s senior management at the time were aware of such payments. IFF has not uncovered any evidence suggesting that such payments had any connection to the United States," the company said in a statement.
On a company-wide business scale, sales to customers who may have received bribes are negligible — they accounted for less than 1% of revenue. However, IFF did not indicate whether these clients were somehow related to the public sector.
The American company has already filed its suspicions with the U.S. Department of Justice, the Securities and Exchange Commission and the Israeli authorities, a spokesman for the Wall Street Journal said. IFF has hired several law firms to conduct the investigation, including the Russian subsidiary of DLA Piper.
IFF produces aromatics and active ingredients for cosmetic products. The company's revenue, taking into account Frutarom in 2019, is expected to be around $5.2-5.3 billion.
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