Turpaz Industries Ltd. — M&A Activity 2026

May 3, 2026

This is an unofficial AI generated translation of the official Hebrew version and has no binding force. The only binding version is the official Hebrew version. For more information, please review the legal disclaimer. .

Turpaz Industries Ltd.

Company Number : 514574524

Address: 10 Hashita, Caesarea

Phone: 03-5560913, Fax: 03-5560915

To

The Tel Aviv Stock Exchange Ltd.

Via MAGNA

To

The Securities Authority

Via MAGNA

May 3, 2026

Subject: Acquisition of a Fragrance and Flavor extracts company in the USA (Phoenix)

Turpaz Industries Ltd. ("Turpaz" or the "Company") is pleased to announce that on May 1, 2026, it signed, through Klabin¹, its wholly-owned subsidiary, an agreement for the acquisition of 100% of the share capital of Phoenix Flavors & Fragrances Inc., a private American company ("Phoenix"), from a private American investment fund (the "Seller"), for a consideration of 95 million dollars² which was paid at the time of signing and an additional consideration of up to 5 million dollars based on Phoenix's performance during the second and third quarters of 2026. The transaction was completed at the time of signing and was financed from Turpaz's independent sources.

Phoenix is engaged in the development, production, marketing, and sale of fragrance extracts used primarily for air freshening, personal care, and home fragrance products, as well as flavor extracts for the food and beverage industry. Phoenix has a broad customer base including hundreds of customers, alongside a variety of products and solutions for the fragrance and flavor industry.

In recent years, Phoenix has worked to expand its activities and establish its position in the fragrance and flavor field in the USA, including through the acquisition of companies complementary to its activities in the USA³ and performing integration and efficiency measures. During 2025, Phoenix completed a comprehensive reorganization and operational efficiency plan, within which the production sites in the fragrance field were consolidated, and a new dedicated site for the flavor field was established in Indiana, as well as advanced computer systems were implemented - moves which contributed to the improvement of Phoenix's operational efficiency and the strengthening of the expense structure. Phoenix operates⁴ in the USA a fragrance production site in New Jersey (Norwood) with an area of approximately 3.5 thousand square meters, a flavor production site in Indiana (South Bend) with an area of approximately 2 thousand square meters, and an innovative research and development (R&D) center in New Jersey (Redbank) with an area of approximately 1.2 thousand square meters, with advanced development capabilities. As of the report date, Phoenix.

¹ Klabin-Turpaz, Inc., a private American company wholly-owned (100%) by Turpaz, which was acquired by Turpaz in 2022.

² The consideration includes a net debt repayment of approximately 63 million dollars. Additionally, the aforementioned consideration includes estimated working capital and net debt adjustments as of the completion date, which are subject to final non-material adjustments to be determined within two quarters from the transaction completion date.

³ In 2017, Phoenix acquired Ascent Aromatics, which deals in the distribution of fragrance extracts and aromatic chemicals; in 2018, it acquired Creative Concepts, which specializes in research and development in the field of scents and flavors; and in 2022, it acquired Innovative Fragrances, which specializes in the development and production of fragrance extracts.

⁴ Via long-term leases.

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This is an unofficial AI generated translation of the official Hebrew version and has no binding force. The only binding version is the official Hebrew version. For more information, please review the legal disclaimer.

Employs 76 workers. Phoenix management is expected to continue leading its activities even after the completion of the transaction.

This acquisition strengthens and expands Turpaz's activities in North America, one of the central markets in the world in the field of fragrance and flavor extracts, and allows Turpaz to establish a full operational activity platform in the USA, including development, production, and marketing capabilities, which is expected to support its continued growth in the region. Phoenix is expected to integrate directly with Turpaz's fragrance extract activities in the USA, among other things through the consolidation and transfer of Klabin¹'s production activities to the Phoenix production site in New Jersey. This move is expected to contribute to operational efficiency, cost savings, and improvement of the expense structure of Turpaz's activities in the USA. Additionally, the integration of fragrance and flavor extract activities in the USA is expected to contribute to building synergistic activities for the Group in North America and strengthening its sales and customer system, among other things through the integration of customer bases, expanding the product offering, and deepening activities with existing customers (Cross-Selling), while leveraging the development and innovation capabilities of the companies. According to Turpaz's estimation, during the coming quarters, synergies in the scope of approximately 2 million dollars are expected to materialize as a result of the consolidation of Klabin and Phoenix activities. In addition, the acquisition is expected to generate synergies with Turpaz's fragrance extract activity in the field of luxury perfumes (Fine Fragrance), among other things through the integration of development capabilities, expanding the product offering, and deepening the group's activity with global customers in this field.

According to adjusted management financial data⁵ received by Turpaz from Phoenix⁶ for the years 2024 and 2025, which are not audited or reviewed, presented below after being prepared according to IFRS reporting rules: Phoenix's revenue amounted to a total of approximately 36.8 million dollars and approximately 36.6 million dollars, respectively; the gross profit amounted to a total of approximately 16.3 million dollars in each of the years; the operating profit amounted to a total of approximately 4.6 million dollars and approximately 2.9 million dollars, respectively; the EBITDA amounted to a total of approximately 6.9 million dollars and approximately 5.1 million dollars, respectively; the net profit amounted to a total of approximately 3.2 million dollars and approximately 2.1 million dollars, respectively; total assets amounted to a total of approximately 65.3 million dollars and approximately 64.0 million dollars, respectively; and total liabilities⁷ amounted to a total of approximately 12.7 million dollars and approximately 8.3 million dollars, respectively.

It should be emphasized that the company's financial estimates and assessments in this report, including regarding the realization of synergies and the improvement of the group's profitability in North America, constitute forward-looking information as defined in the Securities Law, 5728-1968. Such information is based on estimates, forecasts, and assumptions of the company's management at the date of the report, which may not materialize, in whole or in part, or materialize differently than expected, among other things as a result of changes in market conditions, changes in the business environment, and as a result of the materialization of risk factors detailed in section 1.28 of Chapter A of the company's Periodic report for the year 2025.

Sincerely,

Turpaz Industries Ltd.

Signed by: Keren Cohen Hazon, CEO

⁵ Adjusted by neutralizing one-time and non-recurring expenses, including expenses in connection with efficiency and reorganization moves, as well as neutralizing debt and interest expenses to the seller for the debt repaid at the date of completion of the transaction.

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This is an unofficial AI generated translation of the official Hebrew version and has no binding force. The only binding version is the official Hebrew version. For more information, please review the legal disclaimer.

$^{6}$ Phoenix does not have audited or reviewed financial statements prepared according to accounting rules.

$^{7}$ Neutralizing the debt paid at the date of signing as stated above.

5/3/2026 | 6:03:48 AM