Kerry Group to acquire lactase enzyme business of merging Danish companies for €150m

Merging companies were required to sell the businesses by the European Commission to address competition concerns

Irish food company Kerry Group has announced that it has entered into a €150 million agreement to acquire the combined global lactase enzyme business of bioscience companies Chr Hansen and Novozymes.

On Tuesday, the European Commission cleared a proposed merger of Danish companies Chr Hansen (an enzyme maker for the food sector) and Novozymes (which makes enzymes for household products, food and beverages and biofuels), subject to a number of conditions to address competition concerns.

As reported by Reuters, the merging companies last month offered to sell part of their combined global lactase enzyme business, saying that a buyer had already been found.

Kerry Group announced on Tuesday that it has entered into an agreement to acquire this lactase enzyme business for a total of €150 million, subject to “any routine closing adjustments”.

Kerry Group said the acquisition was subject to the Irish company being approved as a buyer by the European Commission. The deal is likely to close in the first half of next year.

The acquisition comprises of certain trade and assets of Crh Hansen’s global lactase enzyme business, as well as 100 per cent of the share capital in a Chinese subsidiary of Novozymes, called Nuocheng Trillion Food (Tianjin) Co Ltd.

The combined lactase enzyme business had attributable revenue of about €40 million in 2022, with sales in more than 50 countries, a statement from Kerry Group said.

The Irish company said the acquisition “further enhances Kerry’s biotechnology solutions capability following the acquisitions of c-LEcta and Enmex”.

“This acquisition adds enzyme technology, which helps create lactose-free and sugar-reduced dairy products, while preserving their authentic clean taste. Global demand for lactase is being driven by increased awareness of lactose intolerance, while many consumers are also choosing lactose-free for lifestyle and health reasons,” the company said on Tuesday.

Kerry Group reported revenues of €8.8 billion in 2022, up from €7.4 billion in 2021, with volume growth of 6.1 per cent last year down from 8 per cent growth in 2021.

The group’s earnings before interest, taxes, depreciation and amortisation (EBITDA) reached €1.2 billion last year, up from €1.1 billion in 2021.

Reporting On: www.irishtimes.com