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I have quite a bit of experience with TFFI, and have in fact visited their Amityville factories in the past. It seems to me that this is an industry where the larger companies are widely disparate insofar as TFFI is probably in the top 100 flavor & fragrance companies in the world, while there are 10,000+ smaller companies, and the largest company, IFF does $1.5B per year in sales. TFFI was interesting to me because Phil Rosner, the President, CEO & Chairman has been in the industry for almost 50 years, explaining the customer relationships with major corporations that TFFI boasts. However, in his mid-60s my concern was that Rosner was a better choice for Chairman, and that TFFI would be better off bringing in a young aggressive CEO-type to work by his side and take over both Pres & CEO roles in time. One of the things I think worth focusing on is the new Board of Directors. There is both deep industry experience (Werner Hiller, Bruce Sites, Irwin Simon and very strong financial guidance (Sean Deson, a senior banker from DLJ's chemical group). I think that Irwin Simon, who is President of Hain Foods, a highly acquisitive company by its nature, should be in a position to bring some of his business to TFFI. My surprise would be if he would do so in a meaningful way without considering acquiring TFFI in whole, for then he could improve margins and capture the whole benefit at Hain, a simple vertical integration that looks obvious to me as a novice. I think the resrtucturing, and sale of SeaFla, have put the company in a financial and operational mode whereby they can be profitable and financilly sound, with increased sales falling to the bottom line in a meaningful way ... TFFI is too small, has been too small, and hopefully now has resized so that if they grow revenues, the benfits will be felt |
