Thaindian News

By Meena Kar
Jan 10, (THAINDIAN NEWS) Danish food ingredients company Danisco A/S, will now be acquired by US based E. I. DuPont de Nemours, as the latter wants to boost its business in food and biofuels. Reportedly, DuPont de Nemours offered DKr665-a-share, to raise Danisco’s share by 24.9 per cent.

Ellen Kullman, the chief executive of DuPont said that the acquisition would facilitate two big challenges of the food industry. She also added that Biotechnology and specialty food ingredients, can alter the entire face of food industry in more than one ways. Firstly, it can substitute renewable material for fossil fuel and secondly, meet the growing food requirements in developing nations. This deal is going to be DuPont’s second biggest business expansion move that would involve an investment of $5.8 billion. In 1999, they made the biggest acquisition, when they acquired a seed manufacturing company, Pioneer, against $7.7 billion. DuPont is all set to handle the $500 million debt on the part of Danisco, as part of the entire deal, through $3 billion of existing cash.

Sydbank analyst Morten Imsgard thinks that it was a good deal. According to him Danisco has been quite competitive in the market in the last year. Yet, in order to combat the cut throat competitive market, it needs to rely on a “strong player”, and that is where DuPont would come for the rescue. Klaus Kehl a representative of Nykredit however predicted the deal, as for long, speculations about the company’s takeover was on. Danisco Chairman Jorgen Tandrup also added that despite a number of potential buyers, they opted for DuPont, as that seemed like the best deal to them.