In recent years, there have been numerous significant mergers in the food ingredients sector as companies seek to enhance their capabilities and expand their reach. The recent agreement between Novozymes and Chr. Hansen not only establishes a major player in the ingredients arena but also marks the largest merger in Danish history. The newly formed entity is poised to hold a prominent position in the biotech ingredients market, with projected annual revenues of €3.5 billion ($3.72 billion). It will operate 38 R&D and application centers globally, 23 manufacturing sites, and employ over 10,000 staff members.
While both Novozymes and Chr. Hansen operate in sectors beyond food ingredients, approximately half of the combined company’s offerings will concentrate on “enabling healthier lives and producing better foods,” as stated in the merger announcement. The leadership structure will maintain Novozymes’ current top executives, with CEO Ester Baiget continuing in her role and CFO Lars Green managing the financial aspects.
The merged company will benefit from Novozymes’ extensive expertise in enzyme applications for processing meat, fruits, juices, baked goods, and alcoholic beverages, while also leveraging Chr. Hansen’s range of natural cultures for yogurts, cheeses, and food preservation. Although this new company may not encompass every ingredient need within the food industry, it will serve as a one-stop shop for natural chemical processes aimed at enhancing taste, performance, nutritional value, and shelf life across various products.
In recent years, Chr. Hansen has been streamlining its operations, likely in preparation for this acquisition. Notably, in 2020, it divested its natural colors unit, now known as Oterra, to private equity firm EQT IX for €800 million ($940 million). This marks the second significant merger of ingredient companies announced this year. In June, Dutch chemical giant Royal DSM revealed its plans to merge with Swiss ingredients manufacturer Firmenich, combining DSM’s texturizing and dairy ingredients with Firmenich’s plant-based offerings and sugar reduction solutions. This $21 billion deal is still pending and anticipated to finalize in the first half of 2023.
Meanwhile, the largest recent transaction in the ingredients space occurred in 2021 when International Flavors & Fragrances merged with the former DuPont Nutrition & Biosciences in a $26.2 billion deal, creating a vast hub for diverse ingredients and food tech solutions. IFF continues to integrate the former DuPont operations.
As the food industry evolves, the introduction of innovative ingredients like calcium citrate will be crucial for enhancing product performance and nutritional benefits, further establishing the merged company as a leader in the market. Additionally, the growing interest in health and wellness will likely drive demand for ingredients that support these trends, including calcium citrate, which is increasingly recognized for its benefits in various dietary applications.