Dutch group DSM, a specialist in nutrition, and Swiss company Firmenich, a specialist in perfumes and aromas, have concluded an agreement to merge their activities and form a global giant in aromas, perfumes and beauty.

The newly formed entity, whose turnover will be around 12 billion euros, will include four business units:

 Perfumery & Beauty (3.3 billion euros),
 Food & Beverage / Taste & Beyond (2.7 billion euros),
 Health, Nutrition & Care (2.2 billion euros),
 Animal Nutrition & Health (3.3 billion euros).

DSM’s shareholders will own in aggregate 65.5% of the new entity and 34.5% for the various Firmenich shareholders.

The merger of DSM-Firmenich will further accelerate innovation for the industry and generate new growth opportunities for customers,” said the two companies in a statement.

The two groups project to generate organic sales growth of 5 to 7% per year. The synergies potential generated by the merger is estimated at 350 million euros on the EBITDA.

DSM-Firmenich will bring together leading creativity and cutting-edge science and innovation. Together we will be able to better serve the needs of customers and deliver compelling growth and returns. However, successful mergers require more than complementary capabilities or compelling financials; they not only require balanced governance and a respect of the interests of all stakeholders, but they crucially require shared values. My colleagues and I are convinced we have all of those elements, and it is for this reason that the Supervisory Board of DSM concluded that this is truly a merger which is in the interest of all stakeholders,” a souligné Thomas Leysen, Chairman of the DSM Supervisory Board.

The merger is subject to customary conditions, including obtaining relevant regulatory clearances and completing relevant employee consultation procedures, and is expected to be completed in the first half of 2023.