DSM Restructures, Reviews Options for Materials

17.09.2021 - DSM is restructuring its health, nutrition and bioscience activities, while also reviewing options for its materials business, including a possible sale. The move is aimed at accelerating the Dutch group’s ongoing transformation and growth plans centered on benefitting people and the planet.

As of Jan. 1, 2022, DSM’s health, nutrition and bioscience activities will be reorganized into three business groups: Food & Beverage; Health, Nutrition & Care; and Animal Nutrition & Health.

“As a global leader in the science behind better health and nutrition, we have the opportunity, capability, and therefore responsibility to apply our resources and expertise where they can have the greatest impact,” said co-CEOs Geraldine Matchett and Dimitri de Vreeze. “By focusing exclusively on our health, nutrition and bioscience activities we will be able to operate with greater agility and impact, and meet the growing need for better and more sustainable nutrition.”

The Food & Beverage business group will combine the food, beverage and pet food activities of DSM’s current Food Specialties and Nutritional Products division. This group will have more than €1 billion in sales and hold a 10% market share, being the market leader in food premixes and the top three player in food enzymes and cultures.

With roughly €2.5 billion in sales, the Health, Nutrition & Care business will be the market leader, providing products across a variety of segments such as early-life and medical nutrition, dietary supplements, pharma, personal care, fragrances, biomedical materials and nutrition improvement for vulnerable patients.

The Animal Nutrition & Health business will have more than €3 billion in sales, focusing on specialty solutions for sustainable animal protein production.

Turning to its two “excellent” materials businesses, comprising engineering and protective plastics, DSM said it will manage these largely on a standalone basis, realigning global support functions accordingly. The company added that the businesses “will likely not be able to maximize their full potential to drive the important industrial shift to a biobased and circular economy.” Matchett said finding new owners is the preferred outcome, although timing of any sale is unclear at present.

DSM’s Materials segment produces more than 450,000 t/y of engineering plastics and had sales of €1.5 billion in 2020. After several divestments, the business is now focused on PA 6 and PA 4.6, along with polyester and thermoplastic composites and the ultra-high molecular weight PE fibers made by subsidiary Dyneema.

Since 2015, the company has been divesting its polymer-related businesses in chunks. In one of the bigger transactions, it sold its coatings resins activities to Germany’s Covestro in October 2020 for €1.6 billion.

Author: Elaine Burridge, Freelance Journalist