Novozymes had acquired EMD/Merck Crop BioScience from Merck KGaA for US $275 and marks the company’s third major purchase in the agricultural biologicals sector in the past three years. EMD/Merck Crop BioScience is headquartered in Milwaukee, Wisconsin and the majority of the company’s activities take place in North and South America. Novozymes has spent the past few years building up its portfolio of sustainable solutions in the agricultural sector.
According to a press release from Novozymes, EMD/Merck Crop BioScience has approximately 165 employees and has generated average annual sales growth of roughly 15 percent during the last seven years. It is expected to generate sales of US $60 million in 2010 and will support Novozymes’ long-term sales growth expectation of more than 10 percent. EMD/Merck Crop BioScience’s EBIT margin supports Novozymes’ long-term EBIT margin expectation of more than 20 percent.
“The acquisition of EMD/Merck Crop BioScience strengthens our global position in the growing industry for agricultural biologicals providing products that enhance the natural growth and yield of crops,” said Steen Riisgaard, CEO of Novozymes. “We have found in EMD/Merck Crop BioScience a company that has a strong strategic fit with our existing BioAg business. In brief, it has a complementary product range and geographical scope, a strong R&D pipeline, and very talented people. Together we can utilize Novozymes’ unique biotechnology platform to bring a new level of innovation to the market.”
Novozymes cites many reasons that EMD/Merck Crop BioScience is an asset to their business portfolio but among them are the fact that their product line-up focuses on biological growth enhancers and nitrogen inoculants primarily used in the production of soybean and pulses. This supports Novozymes’ current nitrogen and phosphate inoculants business.
“Novozymes is dedicated to continued innovation in agriculture, thereby enabling farmers to become even more cost and resource efficient,” said Riisgaard. “In a world that continuously needs to produce more food for a soaring population without further stressing the environment, farmers need effective but more sustainable ways to grow crops. This has led to a strong interest in biofertilizers and other biotechnological solutions.”
Novozymes entered the biofertility market in 2007 with the acquisition of Philom Bios in Canada and has gradually increased its activities, most recently with the acquisition of Turfal in Brazil in August this year. The activities of EMD/Merck Crop BioScience will be integrated into Novozymes’ BioAg organization, which is part of Novozymes’ BioBusiness division. The acquisition is subject to regulatory approvals and is expected to be completed between February and May 2011.