Novonesis (NSIS) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition provides full control of the animal biosolutions value chain, integrating R&D, production, sales, and distribution for feed enzymes and probiotics.

• Enables direct global customer access, consolidates go-to-market model, and expands presence in key regions.

• Enhances ability to cross-sell and innovate by combining tailored enzymes and probiotics, addressing customer needs for animal health and reduced antibiotic use.

• Aligns with growth ambitions and positions the company as a leader in animal biosolutions with a broader, synergistic portfolio.

• Addresses global protein demand and resource scarcity by offering sustainable biosolutions.

Financial terms and conditions

• EUR 1.5 billion all-cash purchase price for dsm-firmenich's share, fully debt financed with committed funding.

• Strong cash generation expected to enable deleveraging to a 1.3–1.7x net debt/EBITDA target within two years.

• Expected to contribute close to 3% of group revenue and 5% for the Planetary Health Biosolutions division in year one.

• Adjusted EBITDA accretion of around €70 million and low single-digit percentage accretion to adjusted EPS in year one, rising to mid-single-digit by year three.

• No impact on expected dividend payouts; strong cash generation and limited CapEx needs reduce financial risk.

Synergies and expected cost savings

• Revenue and growth synergies expected from cross-selling, up-selling, and combining enzyme and probiotic portfolios.

• Immediate impact anticipated from integrating sales forces and expanding geographical reach.

• Three synergy buckets: near-term cross-selling, geographical expansion, and longer-term innovation from combined R&D.

• Limited cost synergies; focus is on growth and profitability accretion rather than cost reduction.

• Highly attractive cash conversion and limited incremental capital expenditure requirements.