UPDATE 1-Symrise buys scent ingredients maker Pinova for $397 mln
* Price tag could rise to $417 mln depending on performance
* Pinova makes perfume ingredients from natural sources
* Symrise shares extend gains (Adds Symrise strategy, seller Torquest, deal multiple)
FRANKFURT, Sept 21 (Reuters) - Germany's Symrise is buying Pinova Holdings, a U.S. maker of perfume ingredients from natural sources, for at least $397 million from buyout firm TorQuest, part of a push into plant-based ingredients for its fragrances and flavours.
Symrise has a focus on plant-based substances, which are preferred by many consumer goods makers over petrochemical-based ingredients. The company expanded into ingredients businesses to have a better control over manufacturing practices.
The deal reflects "the increasing importance of natural and renewable raw materials for the fragrance industry," Symrise Chief Executive Heinz-Juergen Bertram said on Monday.
Pinova was created in 2010 when TorQuest acquired Ashland's refined wood rosin and natural wood terpenes unit and combined it later with LyondellBasell's Flavors & Fragrances business, now called Renessenz.
The price tag amounts to as much as 11.1 times Pinova's 2014 adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) of $37.4 million. That compares with a multiple of 17.3 that Symrise is trading at, 12.7 for rival IFF or 17.2 times for Switzerland's Givaudan, another competitor.
Subject to conditions to be met within 12 months, Canada's TorQuest will receive a premium of $20 million for a total price of up to $417 million.
The buyer's stock extended gains and was up 2.1 percent at 1158 GMT.
Symrise expects annual synergy effects worth 20 million euros ($22.6 million) from the deal by 2020. ($1 = 0.8870 euros) (Reporting by Ludwig Burger and Shubhankar Chakravorty; Editing by Arno Schuetze and David Evans)
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