The sale comprises the European and North American bakery supplies businesses (excluding Caravan Ingredients) and all international activities along with the CSM brand name. The deal, subject to regulatory approval from competition authorities in the US and Europe, is set to clear in the third quarter (Q3) of this year.
CEO of CSM Gerard Hoetmer said he was delighted to have reached the agreement with Rhône Capital – a buyer chosen among a selection of close to ten bidders.
“We have found a strong buyer to protect and strengthen the bakery business,” Hoetmer said in a press call this morning.
“…We had tons of interest; it was in the high single digits... A lot of people saw the value of the entity we are selling right now.”
“The business has a strong future and is well positioned to contribute towards industry consolidation.”
‘We’ll continue to blossom and grow’
Responding to our question on the level of involvement that CSM would have with Rhône Capital during the divestment, Hoetmar said that there will be a lot of cooperation over the coming months.
“We’ll continue to blossom and grow and make sure the business is aligned with the intentions of Rhone,” he said.
“We have had a long preparation time for this and all actions will be continued.”
CSM’s CFO Koos Kramer added that the divestment process will be made easier by Rhône’s intentions to build on the current business as it is – including its workforce, management, customers and product innovation capabilities.
“It will be a very smooth transition working together,” Kramer said.
A choice to split and grow
The Dutch-headquartered ingredients supplier announced its plans to divest its bakery supplies business (that represent around two-thirds of the overall company) eight months ago and reposition as a bio-based ingredients firm.
Today, Hoetmar said the decision to divest bakery supplies and reposition as a bio-based ingredients firm was because CSM was unable to invest the money needed to growth the bakery unit.
In 2012 the bakery supplies businesses had aggregate sales of just over €2.5bn ($3.24bn) and aggregate EBITA excluding one-off costs of €105.8m ($137.5m).