DSM said combining Cargill's cultures and enzymes business with its dairy business will allow it "to propel sales growth as well as capture sizable synergies in global manufacturing and customer reach as well as innovation capabilities in biotechnology and SG&A."
It added that the deal will help it "to become a tier-one supplier of cultures and enzymes to the global dairy market and will greatly accelerate DSM's growth plans for its business, which continues to benefit from consumer demand for more-versatile dairy products."
It hailed the acquisition as further strengthening its global position in dairy ingredients with enzymes, PUFAs, vitamins, cultures, probiotics, bio actives, preservation systems and tests.
Cargill's cultures and enzymes business, which makes cultures and enzymes for the dairy and meat industries, with manufacturing operations in Wisconsin in the U.S. and in France, generates net sales of about 45 million euros ($58.1 million) a year with about 200 employees.
DSM said the market for cultures and enzymes is valued at more than EUR1 billion ($1.29 billion) and is growing more than 5% annually. Applications are primarily found in dairy products, the growing diversity of which, DSM noted, requires versatile culture offerings enhancing taste, texture and mouthfeel characteristics as well as health benefits and convenience.
Last month, Cargill confirmed it was in exclusive talks with DSM about a possible sale of the cultures and enzymes business. The deal is DSM's eighth acquisition in the nutrition area since September 2010.