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Firmenich and DSM set to merge – WWD

PARIS – Firmenich and DSM announced Tuesday morning that they will merge to become the world’s largest provider of fragrance, beauty, wellness and nutrition, with revenues of more than 11 billion euros.

The new group combining the Swiss fragrance and flavor supplier, which is the largest private and one of the largest in the world, and the Dutch scientific health and nutrition company will be called DSM-Firmenich.

As of 11:10 a.m. CET, DSM shares were trading up 7.8% in Amsterdam.

The merger will take place through a tender offer of DSM shares in exchange for DSM-Firmenich shares, with a one-to-one ratio, plus a contribution of Firmenich shares to DSM-Firmenich in exchange for DSM-Firmenich shares and 3.5 billion euros in cash.

DSM shareholders will own 65.5% of the company and Firmenich shareholders the rest when DSM-Firmenich is created.

The deal is expected to close in the first half of 2023.

The companies are aiming for 350 million additional recurring profits and 500 million euros in annual turnover several years after the merger.

“DSM-Firmenich will bring together cutting-edge creativity and cutting-edge science and innovation. Together, we will be able to better meet client needs and deliver compelling growth and returns,” said Thomas Leysen, Chairman of the Supervisory Board of DSM, in a statement.

“The combination of DSM and Firmenich is transformational and brings together two culturally aligned and iconic companies, each with more than 125 years of innovation heritage,” said Patrick Firmenich, President of Firmenich. “Our shared purpose and shared values, combined with our highly complementary capabilities, give me confidence in our ability to further accelerate our growth through innovation and new creations. I am convinced that for all stakeholders of the future DSM-Firmenich company, the most exciting times are yet to come.

The new company will have four companies. This will include a fragrance and beauty division, with a combined turnover of 3.3 billion euros.

“DSM-Firmenich will be the leading creator of positive fragrances and beauty products, as well as a global flavor ingredients company that together have leadership in renewable, natural, biodegradable and biotechnology-derived ingredients,” they said. jointly declared the companies.

In addition, Firmenich’s fragrance and ingredients business is to be expanded into beauty through DSM’s personal care and flavor business, which operates in the categories of cleanliness and wellness, among others. other booming segments today.

DSM-Firmenich’s business will also include food and beverage/taste and beyond, with sales of €2.7 billion; health, nutrition and care, with a turnover of 2.2 billion euros, and animal nutrition and health, with a turnover of 3.3 billion euros.

The expected medium-term sustainable organic growth in sales per year is between 5 and 7%, with an adjusted EBITDA margin of 22 to 23%.

DSM-Firmenich will have a Swiss-based holding company with head office in Kaiseraugst, Switzerland, and will be listed on Euronext Amsterdam.

The group’s headquarters will be in both Kaiseraugust and Maastricht, the Netherlands.

To learn more, see:

EXCLUSIVE: Firmenich partners with beauty retailer Harmay in China

Firmenich increases its production capacity of renewable ingredients

Firmenich sales accelerate in the second half