Novozymes and Chr Hansen to combine for biosolutions
Novozymes and Chr Hansen have agreed to create a global biosolutions partnership through a statutory merger of the two companies, they say. The combination is expected to unleash the full potential of biological solutions and generate significant value for all stakeholders and society at large, the companies add.
The combination will leverage Novozymes and Chr Hansen Holding’s complementary expertise, capabilities, and innovation and commercial excellence to develop biological solutions that will enable healthier lives, transform food systems and accelerate towards a climate neutral society, according to the firms, with a combined annual revenue of approximately €3.5 billion. Annual revenue synergies are estimated at €200 million with €80-90 million EBIT impact achievable within four years after completion and estimated €80-90 million in cost synergies achievable within three years after completion. There is expected organic revenue growth CAGR of 6-8% until 2025.
The contemplated combination will be effectuated through a statutory merger in accordance with the Danish Companies Act, with Novozymes as the continuing company and Chr Hansen as the dissolving company. The completion of the merger is currently expected to be in the fourth quarter of the calendar year 2023/first quarter of calendar year 2024, is subject to, inter alia, approval by the extraordinary general meetings of Novozymes and Chr. Hansen, respectively, as well as customary merger control and other regulatory approvals from relevant authorities.
Ester Baiget, president and CEO of Novozymes, said: “The combination of two strategically complementary companies with a shared purpose and advanced capabilities will show the world the true power of biosolutions. The announcement is fully aligned with Novozymes’ strategy and is another step towards unlocking additional growth opportunities. Novozymes and Chr Hansen share the strong conviction that our combined scale, know-how, commercial strengths, and innovation excellence will drive value for our shareholders, customers and society at large by providing the sustainable solutions the world so urgently needs.”
Novozymes estimates the current addressable market for biological solutions to be around €15 billion and growing. The combination of Novozymes and Chr Hansen will capitalise on this by providing the biological solutions and biotech necessary to address global megatrends and meet customer demands to produce more, sustainably, and efficiently, they say.