International Flavors & Fragrance
said Monday that its earnings will fall short of estimates, cut its dividend and announced the acquisition of a competitor for $970 million.
Shares of International Flavors tumbled on the news finishing down $2.81, or 12%, at $20.75.
International Flavors & Fragrance, which develops scents and flavors that manufacturers use in producing soaps, pharmaceuticals and prepared foods, said it agreed to buy
Bush Boake Allen
, another fragrance company, for $48.50 a share. The price represents a 10.7% premium over Montvale, N.J.-based Bush Boake Allen's recent market price.
Bush Boake Allen finished up $4.06, or 9%, at $47.63.
Also Monday, New York-based International Fragrance said it lowered its earnings because annual sales are expected to decline by 4%. Its full year earnings per share are expected to be $1.55 per share, versus $1.79 a share in 1999. The consensus among analysts was for International Fragrance to earn $1.93 a share for the full year, according to market research firm
First Call/Thomson Financial
The company also decreased its quarterly dividend to 15 cents a share from 38 cents, starting with the fourth quarter of 2000.