DSM and Firmenich to merge in 42 billion EURO deal
DSM and Firmenich have entered into a business combination agreement to establish the leading creation and innovation partner in nutrition, beauty and well-being. The Dutch specialty chemicals maker has said that this merge with Swiss peer Firmenich in a deal involving shares and cash will position them as leaders and major player in the fast-growing food ingredients and health products markets.
Once the merger is completed, DSM-Firmenich, a newly incorporated Swiss-domiciled company, will hold the DSM and Firmenich businesses and will be listed on Euronext Amsterdam. The merger will be effected by a public exchange offer to exchange DSM shares for DSM-Firmenich shares and the contribution of all Firmenich shares in exchange for DSM-Firmenich shares and a cash consideration. In this sense, DSM shareholders would own 65.5% of the new Dutch-Swiss group, while current owners of Firmenich will own the rest of the shares and will receive 3.5 billion euros in cash.
The transaction remains subject to customary conditions and is expected to close in the first half of next year. The companies said the merger could lead to an organic sales growth of 5% to 7% per year and annual cost savings of 350 million euros. The new company will be based in Switzerland, with headquarters in Kaiseraugst and Maastricht, in the south of the Netherlands.
Founded more than 150 years ago, the Dutch-Swiss company specializes in nutritional ingredients for food and feed with proven world-leading bioscience capabilities and an international network of high-quality manufacturing sites that underpin a business model of global products, local solutions and personalization and precision. For Health, Nutrition & Bioscience (excluding Materials), DSM delivered EUR 7.3bn of sales in 2021, with adjusted EBITDA of EUR 1.4bn and an adjusted EBITDA margin of 19%.
From the other side, the Swiss Firmenich is the world’s largest privately-owned fragrance and taste company and has been family-owned for 127 years. The Swiss company specializes in perfumes, flavors, and ingredients and is renowned for its world-class research as well as leadership in sustainability. Firmenich’s businesses include making food ingredients and scents for detergents and creating fragrances for brands such as Calvin Klein and Mugler. The company delivered CHF 4.5bn of sales in 2021 with Adjusted EBITDA margin of 20%. Firmenich was established in 1895. Today’s shareholders, all direct descendants of Fred and Hugo Firmenich, control the Firmenich group through the family holding company Sentarom.
Walder Wyss advised DSM in connection with the transaction. The team was co-led by Thomas Meister (partner, tax, pictured left) and Thiemo Sturny (partner, capital markets/m&a, pictured right) and further included Dimitrios Berger (senior associate, capital markets/m&a), Janine Corti (counsel, tax), Alex Nikitine (partner, capital markets/m&a), Lukas Wyss (partner, finance), Maurus Winzap (partner, tax), Fabienne Limacher (partner, tax), Ursina Gremminger (managing associate, tax), Jan Ole Luuk (counsel, tax), Natascha Rizzi (associate, tax), Reto Jacobs (partner, competition), Gion Giger (counsel, competition), Alexander Gutmans (notary), Jürg Fisch (associate, corporate/m&Aa) and Milos Karic (trainee, corporate/m&a).
Bär & Karrer acts also as legal advisor to Firmenich together with the Dutch law firm Stibbe. The team consists of partners Rolf Watter (pictured right), Urs Kägi, Thomas Rohde, Rebecca Schori, Florian Schweighofer and Marie-Cristine Kaptan (all m&a and corporate).
Homburger advised Sentarom in this transaction. The team was led by partner Daniel Daeniker and comprised associates Romain Fakhoury, Léonard Aeschlimann and Oriana Schöni (all corporate / m&a).
