DSM in talks to acquire Cargill's cultures business

by World Grain Staff
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HEERLEN, NETHERLANDS — Royal DSM announced on Sept. 20 that it is in exclusive discussions with Cargill which may, or may not result in the acquisition of Cargill’s cultures and enzymes business by DSM.
The cultures and enzymes business of Cargill is a global leading manufacturer of cultures and enzymes for the dairy and meat industries with manufacturing operations in Wisconsin (U.S.) and France. It has a strong pipeline of new products built on three pillars of technology: culture texture toolbox, fast acidification for cheese yield improvements and culture flavor systems. The business generates net sales of about €45 million per year with approximately 200 employees.
The global market for cultures and enzymes is valued at over €1 billion, growing steadily at more than 5% per annum. A possible combination of the Cargill cultures and enzymes business with the dairy business of DSM Food Specialties would be highly complementary creating a strong global player and enabling DSM to propel sales growth as well as capture sizable synergies in global manufacturing footprint, customer reach as well as innovation capabilities in biotechnology and SG&A.
A successful acquisition of the Cultures and Enzymes business of Cargill would be the eighth acquisition in the Nutrition cluster since DSM announced its corporate strategy DSM in motion: driving focused growth in September 2010. These acquisitions form an integral part of DSM’s strategy for its Nutrition cluster and will contribute to the current and future growth of DSM’s attractive portfolio in health, nutrition and materials.
Cargill confirmed the exclusive discussion with DSM on the potential sale.
This proposed sale is in line with its strategy to re-focus its texturizing business and concentrate on product lines that are adjacent to the company’s core activities and where it can be a leading or relevant player in the marketplace, Cargill said.
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