Darling Ingredients to buy collagen company Gelnex for $1.2 bln (updated)

Banco Santander Brasil SA

18/10/2022 16:28

(Adds details of deal, background)
       Oct 18 (Reuters) - Darling Ingredients Inc  DAR.N  said
on Tuesday it would buy collagen products maker Gelnex for $1.2
billion in cash as the producer of ingredients for the bioenergy
industry looks to boost production of collagen made from
grass-fed cattle.
    The market for collagen is expected to double in the next
five years, Darling said in a statement, as the protein becomes
a popular supplement and skin-care product ingredient, with
claims to help smoothe wrinkles and benefit hair, nails, joints,
bones and muscles. 
    Headquartered in Brazil with five facilities in South
America and one in the United States, Gelnex has the capacity to
produce 46,000 metric tons of collagen products annually, which
it exports to more than 60 countries around the world.
    Morgan Stanley & Co LLC acted as Darling's exclusive
financial adviser on the deal, which is expected to close in the
first quarter of 2023. Banco Santander Brasil SA  SANB3.SA 
advised Gelnex on the deal, according to one source with
knowledge of the matter.
    The negotiations began a year ago, added the source, who
asked for anonymity to disclose private talks, and Gelnex
received competing bids from strategic investors and private
equity firms. 
 (Reporting by Arunima Kumar in Bengaluru and Tatiana Bautzer in
Sao Paulo
Editing by Anil D'Silva and Matthew Lewis)
 ((Arunima.Kumar@thomsonreuters.com; Twitter: https://twitter.com/Aru_Kumar94
 ;))