DSM, Firmenich Exchange Offer Gets Green Light
PARIS — The merger of DSM and Firmenich is moving ahead.
The Dutch science-based health and nutrition concern and the Swiss fragrance and flavors supplier said jointly Tuesday morning that the Dutch Authority for Financial Markets, or AFM, has approved the offering circular related to their deal.
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As announced on May 31, the two groups said they would merge to become the largest fragrance, beauty, well-being and nutrition supplier in the world, with revenues of more than 11 billion euros.
The new group combining DSM and Firmenich, which is the largest privately owned fragrance and flavors supplier and among the biggest globally, is to be called DSM-Firmenich.
The acceptance period starts at 9 a.m. CET on Nov. 23 and expires at 5:40 p.m. CET on Jan. 31, unless extended.
The merger will be made through a public offer for 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 percent of the company, and Firmenich stakeholders the remainder at DSM-Firmenich’s inception.
The deal is expected to close in the first quarter of 2023.
“This merger is a transformational moment for the history of both businesses. DSM-Firmenich will be a global-scale partner, uniquely positioned to anticipate and better address the evolving needs of consumers by unlocking opportunities for our customers, and our people,” Gilbert Ghostine, chief executive officer of Firmenich, said in a statement.
“Our two companies have an unrelenting commitment to their role in society with ESG at the core of everything we do, and I firmly believe that DSM-Firmenich will have a positive and measurable impact on people, climate and nature,” he added.
The companies said their merged entity will be well-positioned to accelerate growth by addressing changes in consumer preferences and needs, driven by trends such as climate change, accessible nutrition, inequalities, and hygiene and sanitation.
“These shifts drive consumer preferences for health and sustainability benefits whilst enjoying superior experiences in areas such as taste and fragrance,” they said in the statement. “As a market leader with enhanced creation and application capabilities, DSM-Firmenich will be able to serve both global and local customers, informed by local consumer preferences, across regional and local hubs around the world. Opportunities from new pioneering and complementary digitally powered business models will build upon the 125-plus-year heritages of each DSM and Firmenich in purpose-led scientific discovery and innovation.”
In a separate release on Tuesday, Firmenich published its first-quarter results. In the three months ended Sept. 30, the group generated sales of 1.25 billion Swiss francs, or $1.3 billion, up 8.8 percent in reported terms and a 11.6 percent rise on a constant-currency basis versus the same prior-year period.
Firmenich posted adjusted earnings before interest, taxes, depreciation and amortization of 237 million Swiss francs, despite a negative currency exchange rate effect.
The company said that in the period, it continued experiencing strong end-market demand across geographies, customers and segments.
