AMSTERDAM: Dutch speciality chemicals maker DSM said it has about 3 billion euros to spend on acquisitions to expand its nutrition business and maintain its profit growth.
“We will look to expand our portfolio into the whole food and beverages area, where we see clear opportunities in consumer brands”, DSM’s chief executive Feike Sijbesma said on Wednesday.
DSM’s products range from vitamins, enzymes and infant formula to fabrics and plastics used in cars, garments and construction and its brands include Dyneema and Rovimix.
The company, whose competitors include Lanxess and Evonik , said it would eventually return excess cash to shareholders if it failed to make acquisitions.
“We can’t sit on this amount of money for years. But our focus now is to see whether we can find the right targets,” Sijbesma said on a media call ahead of DSM’s investor day.
Analysts and investors have urged Sijbesma to split DSM’s Nutrition and Materials businesses, but in his strategy update the CEO made it clear this was not his plan.
Instead the materials division will get a stronger focus on health products, biotechnology and sustainable applications, he said, bringing its activities more in line with those of the larger nutrition division.
DSM said it expected “high single digit” growth in adjusted earnings before tax, interest, depreciation and amortisation (EBITDA) from 2019 to 2021, as comparable sales outpace the market average with a yearly increase of around 5 per cent. — Reuters
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