DSM completes acquisition of Fortitech and strengthens its human nutrition business
(Thomson Reuters ONE) -
Royal DSM, the global Life Sciences and Materials Sciences company, announced
today that it has completed the acquisition of Fortitech, Inc. (Fortitech). The
transaction, for a total enterprise value of USD 634 million (about ?495
million) strengthens DSM's Human Nutrition and Health business, by expanding the
company's value chain presence and adding additional capabilities. As a result
of the acquisition, announced on 8 November 2012, approximately 520 employees
are joining DSM.
Feike Sijbesma, CEO and Chairman of the DSM Managing Board, said: "The
acquisition of Fortitech is the ninth acquisition in the Nutrition cluster since
we announced our corporate strategy DSM in motion: driving focused growth in
September 2010. These acquisitions will contribute to the current and future
growth of our attractive portfolio in health, nutrition and materials, resulting
in stronger and more stable growth and profitability for DSM overall."
Leendert Staal, President and CEO of DSM Nutritional Products, commented:
"Completing the acquisition of Fortitech is another milestone in the
implementation of DSM's Nutrition strategy. We are expanding our value chain
presence and will be able to deliver more value to our customers. Fortitech will
be an important part of the Human Nutrition and Health business within DSM
Nutritional Products. Our attention is now fully focused on ensuring a smooth
integration of the Fortitech business in a timely and efficient manner, with
business continuity and customer satisfaction as key priorities for us while we
welcome Fortitech's 520 employees to DSM."
Strategic rationale
Customers especially in the food and beverage industry are increasingly looking
for solutions providers offering a broad range of food ingredient blends that
cover a more comprehensive portfolio of ingredients, sometimes even requesting
the complete formula, for a given product. DSM's Human Nutrition and Health
(HNH) premix business is a channel to market primarily for its own nutritional
ingredients. Fortitech offers customized solutions in blends with a highly
responsive and flexible customer service model. Fortitech works with a broad
range of externally sourced nutrients and food ingredients including vitamins,
minerals, nucleotides, amino acids, herb extracts, nutraceuticals, flavors,
seasonings, colors, caffeine, proteins, sweeteners, carbohydrates and enzymes.
The acquisition of Fortitech accelerates DSM's strategy to become a full
solutions provider in food ingredient blends. For DSM the acquisition of
Fortitech expands its value chain presence, while adding additional capabilities
to its business.
With the acquisition of Fortitech DSM now has announced over ?2.8 billion worth
of growth enhancing acquisitions in just over two years, of which ?2.4 billion
in its Nutrition cluster. After completion of the announced acquisitions DSM's
Nutrition cluster will on a pro forma basis realize ?4.6 billion in net sales
with an EBITDA-margin target in the range of 20-23% on an annual basis,
resulting in stronger and more stable growth and profitability for DSM overall.
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.
Integration
Full scale integration of the two businesses will now begin. A dedicated
integration team consisting of both DSM and Fortitech representatives will work
diligently to assess the best way to combine the two organizations while
focusing on future synergy generation between both businesses.
Fortitech
Fortitech, a privately held company based in Schenectady (New York, USA), is a
leader in customized, value added food ingredient blends for food & beverage,
infant nutrition and dietary supplements industries. The company has
approximately 520 employees. Fortitech has six production sites located in New
York (USA), California (USA), Campinas (Brazil), Kuala Lumpur (Malaysia),
Gastrup (Denmark) and Poznan (Poland), with sales offices in China and Mexico.
Financial highlights
Net sales for 2013 are expected to be about USD 270 million with an EBITDA of
about USD 70 million, including synergies and excluding exceptional items. DSM
has identified attractive cost synergies at about 10% of net sales, which will
be fully realized by 2015. In addition, one-time synergies - primarily capital
expenditure avoidance- are estimated at USD 70 million. DSM expects the
transaction to be EPS accretive in the first year after closing.
DSM - Bright Science. Brighter Living.(TM)
Royal DSM is a global science-based company active in health, nutrition and
materials. By connecting its unique competences in Life Sciences and Materials
Sciences DSM is driving economic prosperity, environmental progress and social
advances to create sustainable value for all stakeholders. DSM delivers
innovative solutions that nourish, protect and improve performance in global
markets such as food and dietary supplements, personal care, feed,
pharmaceuticals, medical devices, automotive, paints, electrical and
electronics, life protection, alternative energy and bio-based materials. DSM's
22,000 employees deliver annual net sales of around ?9 billion. The company is
listed on NYSE Euronext. More information can be found at www.dsm.com.
Or find us on:
For more information:
DSM Corporate Communications DSM Investor Relations
Herman Betten Dave Huizing
tel. +31 (0) 45 5782017 tel. +31 (0) 45 5782864
e-mail media.relations(at)dsm.com e-mail investor.relations(at)dsm.com
Press Release-pdf:
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Source: DSM N.V. via Thomson Reuters ONE
[HUG#1666163]
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Datum: 19.12.2012 - 08:15 Uhr
Sprache: Deutsch
News-ID 214220
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