DSM stocks up on ingredients trend with Swiss deal
31/05/2022 10:00
(The author is a Reuters Breakingviews columnist. The opinions
expressed are his own.)
By Peter Thal Larsen
LONDON, May 31 (Reuters Breakingviews) - The $29 bln Dutch
producer of food supplements is swallowing family-owned
Firmenich for shares and 3.5 bln euros in cash. That boosts its
appeal with consumer groups seeking to manipulate taste, smell
and texture. By making concessions on governance, DSM has got a
decent price.
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CONTEXT NEWS
Dutch specialty chemicals maker Royal DSM said on May 31 it
would merge with Swiss peer Firmenich, in a deal involving
shares and cash, to become a leading supplier of food and
ingredients to beauty and well-being products.
DSM shareholders would own 65.5% of the new Dutch-Swiss
group, with shareholders of family-owned Firmenich receiving the
rest, plus 3.5 billion euros in cash. The companies expect a
mixture of cost savings and revenue benefits to boost combined
EBITDA by 350 million euros a year.
The new company will be based in Switzerland, with
headquarters in Kaiseraugst and Maastricht, in the south of the
Netherlands. The combined company’s shares will remain listed on
Euronext Amsterdam.
Separately, DSM announced the sale of its engineering
materials subsidiary for 3.85 billion euros to private equity
firm Advent International and German chemicals company Lanxess.
DSM shares were up 9% at 158.50 euros by 0745 GMT on May 31.
(Editing by Ed Cropley and Streisand Neto)
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