DuPont to Acquire Danisco for $6.3 Billion
DuPont to Acquire Danisco for $6.3 Billion
DuPont to Acquire Danisco for $6.3 Billion
DuPont has agreed to acquire Danisco (Copenhagen), a maker of enzymes and specialty food ingredients, for $6.3 billion.
Danisco’s Genencor unit is the second-largest maker of industrial enzymes after Novozymes. The addition of enzymes boosts DuPont’s efforts to build a leading position in industrial biotechnology, including renewable fuels and materials. Genencor’s current efforts in renewables include development of bio-based isoprene with Goodyear Tire & Rubber Co. and a joint venture with DuPont in second-generation bioethanol. Danisco said last month is expects to post revenue of around DKK 15.3 billion ($2.65 billion) for the fiscal year ending March 30, 2011, with EBIT of DKK 2.2 billion-2.3 billion for an EBIT margin of around 14.5%.
DuPont agreed to pay DKK 665/share, a 24% premium to Danisco's closing price on Friday.
"Biotechnology and specialty food ingredients have the potential to change the landscape of industries, such as substituting renewable materials for fossil fuel processes and addressing food needs in developing economies, that will generate more sustainable solutions and create growth for the company,” says DuPont chair and CEO Ellen Kullman.
DuPont will fund the deal with $3 billion in cash and the remainder in debt. The deal will reduce 2011 earnings 30 cts-45 cts/share below the forecast range of $3.30-$3.60/share announced last month, DuPont says. The transaction is expected to close early in the second quarter and be cash and will add to earnings in 2012, DuPont says.
Danisco’s Genencor unit is the second-largest maker of industrial enzymes after Novozymes. The addition of enzymes boosts DuPont’s efforts to build a leading position in industrial biotechnology, including renewable fuels and materials. Genencor’s current efforts in renewables include development of bio-based isoprene with Goodyear Tire & Rubber Co. and a joint venture with DuPont in second-generation bioethanol. Danisco said last month is expects to post revenue of around DKK 15.3 billion ($2.65 billion) for the fiscal year ending March 30, 2011, with EBIT of DKK 2.2 billion-2.3 billion for an EBIT margin of around 14.5%.
DuPont agreed to pay DKK 665/share, a 24% premium to Danisco's closing price on Friday.
"Biotechnology and specialty food ingredients have the potential to change the landscape of industries, such as substituting renewable materials for fossil fuel processes and addressing food needs in developing economies, that will generate more sustainable solutions and create growth for the company,” says DuPont chair and CEO Ellen Kullman.
DuPont will fund the deal with $3 billion in cash and the remainder in debt. The deal will reduce 2011 earnings 30 cts-45 cts/share below the forecast range of $3.30-$3.60/share announced last month, DuPont says. The transaction is expected to close early in the second quarter and be cash and will add to earnings in 2012, DuPont says.
“Danisco has two well-positioned global businesses that strongly complement our current biotechnology capabilities, R&D pipeline, and specialty food ingredients, a combination that offers attractive long-term financial returns,” Kullman says. “This also would create opportunities across other parts of the DuPont portfolio, including traditional materials science offerings.”
Genencor accounts for a third of Danisco’s revenues. The remaining two-thirds is food ingredients, including gums, cultures and sweeteners. DuPont says the transaction is subject to customary closing conditions, including regulatory approvals and the tender of more than 90% of Danisco shares.
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