Case Study

Royal Cosun UA has sold C5 Yeast Company B.V. to Royal DSM N.V.

Royal Cosun UA (Cosun) has sold its subsidiary, C5 Yeast Company B.V., to Royal DSM N.V. (DSM) for an undisclosed consideration.

C5 Yeast Company was part of former Royal Nedalco, Cosun’s alcohol business group which was divested in 2011. C5 Yeast Company has developed a unique yeast technology and extensive patent position in 2nd generation bio-ethanol, i.e. ethanol produced from non-edible C5 sugars. Based on its innovative know-how, yeast strains have been developed capable of efficiently fermenting C5 sugars, such as xylose and arabinose. This technology brings 2nd generation bio-ethanol closer to mass-scale production, which reduces society’s dependence on fossil feedstocks. Furthermore, it avoids the food versus fuel dilemma which is linked to 1st generation bio-ethanol, i.e. ethanol produced from C6 sugars, which are present in edible feedstock such as corn, wheat, sugarcane and sugar beets. Ethanol can be used as a fuel for vehicles in its pure form, but it is usually used as a gasoline additive to increase octane and improve vehicle emissions.

Royal DSM N.V. is a listed global science-based company active in health, nutrition and materials. DSM already had a position in the development of 2nd generation biofuels. The acquisition of the C5 Yeast Company adds additional technology to DSM’s portfolio, allowing DSM to further optimize its yeast technology. DSM is convinced this will be a winning combination.

Cosun is a cooperative owned by Dutch sugar beet growers. The divestment of the C5 Yeast Company means that Cosun can focus more on its core activities centered around the processing of agricultural raw materials. Next to its traditional food business in sugar (Suiker Unie), potato specialties (Aviko), inulin (Sensus) and fruit/vegetable products (SVZ), Cosun has recently strengthened its activities in the area of bio-based products for non-food applications.

Oaklins' team in the Netherlands advised the seller in this transaction.

 

WHAT OUR CLIENT SAID

Gert de Raaff, Director of Corporate Development and member of the Executive Board of Royal Cosun, said: “From the beginning, the Dutch team believed in the attractiveness of the C5 Yeast Company to several industrial players and consequently in a successful transaction. Multiple strategic buyers were approached from all over the globe and several of them indeed showed interest. In a competitive process we have, with the support of the team, been able to find an agreement with DSM, a strong company with a clear strategic interest in C5 Yeast Company. We are convinced that they will be able to take the business into its next stage.”

Tombstone image for Royal Cosun UA has sold C5 Yeast Company B.V. to Royal DSM N.V.

KEY DEAL CONTACTS

Robert Boersma

Netherlands

Partner

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