Danisco will pay €419 million to Genencor parent Eastman Chemical for its 42 per cent stake in the NASDAQ listed firm, which makes biocatalysts and other biochemicals and also has a drug development platform. Genencor's annual revenues are expected to come in at around $400 million in 2004.
The news came as something of a surprise, given that Danisco had been tipped to divest its Genencor holding in order to fund its activities in food ingredients, sweeteners and sugar. Now, Danisco makes it first foray into the healthcare and industrial enzymes sectors.
"Through this new business area, Danisco will be able to service the same customers in more ways, in particular large multinationals with household personal care and food product portfolios," the firm said in a statement. Danisco has said in the past it wants to double the size of its consumer ingredients business.
The deal follows Danisco's acquisition of the food ingredients business of French chemical company Rhodia for €320 million in June, and the company is also rumours to be in the frame to buy the ingredients unit of Denmark's Chr Hansen.
Genencor's healthcare business focuses on the use of protein engineering and expression technologies - developed as part of its other activities - to create therapeutic proteins. It has been developing an enzyme prodrug therapy technology platform that aims to expand the therapeutic window of cytotoxic drugs for cancer. The intention is to use protein engineering and catalysis to focus the active drug specifically at the site of the tumour for increased efficacy and safety.
It remains to be seen whether this business will remain part of Danisco in the long-term, or whether the Danish company may choose to spin it out or sell it on. Parallels can be drawn with Chr Hansen's re-positioning as a pharmaceuticals pure-play focused on the allergy vaccines developed by its Alk-Abello unit.