HEERLEN, Netherlands and
COLUMBIA, Md., Dec. 21, 2010 /PRNewswire-FirstCall/ --
- DSM (NYSE Euronext: DSM KON) to offer US$31.50 for each share of Martek Biosciences
Corporation (Nasdaq: MATK) in an all-cash transaction (through a
tender offer)
- Total consideration of US$1,087
million (about euro 829
million)
- Offer price represents 35% premium to Martek's closing share
price on December 20, 2010
- Martek Board of Directors recommends the offer
- Acquisition adds new growth platform for natural, healthy
Polyunsaturated Fatty Acids (PUFAs) nutrition ingredients (Omega-3
DHA and Omega-6 ARA)
- PUFAs are clinically proven to have important human health
benefits. Martek is a leader in this field with strong positions,
especially in Infant Formula Nutrition applications
- Acquisition positions DSM as a leader in PUFAs and in Infant
Nutrition, greatly strengthens DSM's presence in the United States and expands DSM's
complementary technology platform in the field of algal and other
microbial fermentations
- Martek's growth will be accelerated by DSM's global market
reach, technology base and application skill capabilities, its
insights in the food, beverage and global dietary supplements
markets and its strength in industrial biotechnology and related
applications
- Acquisition is immediately EPS accretive
Royal DSM N.V., the global Life Sciences and Materials
Sciences company, and Martek Biosciences Corporation today announce
that they have entered into a definitive agreement under
which DSM will acquire all the outstanding shares of common stock
of Martek for US$31.50 in cash per
share for total consideration of US$1,087
million. The transaction has been approved by DSM's
Supervisory Board and is recommended by Martek's Board of
Directors. Subject to customary conditions, the tender process is
expected to close in February 2011,
and the transaction is expected to close in the first or second
quarter of 2011.
The agreed price represents a premium of 35% to Martek's closing
share price of US$23.36 on
December 20, 2010, and 39% to the
volume weighted average closing price of Martek's common stock over
the last 90 days.
The Transaction
The acquisition is structured as an all-cash tender offer for
all the outstanding shares of Martek common stock to be followed by
a merger in which each remaining share of Martek common stock would
be converted into the same cash per share price paid in the tender
offer. The tender offer is expected to commence between
10 January 2011 and 25 January 2011. The Martek Board of Directors
has recommended that Martek stockholders accept the offer and
tender their shares into the offer when it is made. The acquisition
is subject to the satisfaction of customary conditions, including
the tender of a majority of the outstanding shares of Martek common
stock on a fully-diluted basis and the expiration or earlier
termination of the Hart-Scott-Rodino antitrust waiting period and
other regulatory approvals. The tender process is expected to close
in February 2011, and the transaction
is expected to close in the first or second quarter of 2011.
The transaction is not subject to a financing condition, and DSM
intends to finance the acquisition from existing cash.
Strategic rationale
The purchase by DSM of Martek, a U.S. based producer of high
value products from microbial sources that promote health and
wellness through nutrition, will be the first major acquisition by
DSM after its successful transformation into a Life Sciences and
Materials Sciences company. This transaction is fully in line with
DSM's strategy for its Nutrition cluster "continued value
growth" and adds a new growth platform for healthy and natural
food ingredients for infant formula and other food and beverage
applications, especially focused on Polyunsaturated Fatty Acids
(PUFAs) such as microbial Omega-3 DHA (docosahexaenoic acid) and
Omega-6 ARA (arachidonic acid).
There is significant, broad based scientific evidence about the
link between health and nutrition. PUFAs have been clinically
proven to have a positive impact on human health and Martek is a
leader in this field. Martek therefore represents an attractive
strategic acquisition for DSM. It will provide DSM with new
opportunities in the infant nutrition segment as well as food and
beverage and dietary supplements and create a strong platform for
DSM to enter the fast growing Omega-3 and Omega-6 market through
Martek's microbial DHA and ARA products.
DSM will be able to leverage DSM's global nutritional
infrastructure (global market reach, application skills, R&D
and manufacturing technology base) to channel and accelerate the
growth of these products into other regions, applications and
market segments beyond Martek's current strong US-based position in
infant formula ingredients and growing position in food and
beverage and dietary supplement applications. As a result of the
scale and resources that DSM can bring to the already solid
businesses of Martek, DSM instantly becomes a leading player in the
field of microbial PUFAs and through this attractive growth segment
expects to drive compelling financial performance for its
shareholders. The acquisition is immediately EPS accretive for DSM
by 15 to 20 euro cents per ordinary
share on a full year basis.
The two companies already have a longstanding relationship as
DSM supplies Martek with the key base material for its ARA product.
DSM has complementary intellectual property to the broad range of
patents and intellectual property Martek owns, which will further
extend the competitiveness of the combined company's proprietary
products.
DSM will also benefit from Martek's recent acquisition of
Amerifit, an attractive consumer business for branded dietary
supplements with very specific health benefits, which it will be
able to use as an additional marketing channel for both Martek as
well as DSM ingredients.
Furthermore, Martek's algal and other microbial-based
biotechnology platform and its robust algal technology pipeline
which complements DSM's own biotechnology portfolio, is expected to
deliver new nutritional and non-nutritional (industrial) growth
opportunities.
The acquisition is expected to realize material revenue
synergies through expanded distribution, marketing and product
development as well as other operational efficiencies, and will
accelerate DSM's revenue growth.
Martek is headquartered in Columbia Maryland USA and had annual
net sales of US$ 450 million for its
fiscal year which ended October 31,
2010. Martek has five principal locations and some 600
employees.
Feike Sijbesma, CEO/ Chairman of the DSM Managing Board,
said:
"Martek is a great company and a leader in the innovation,
development, production and sale of high-value products from
microbial sources that promote health and wellness through
nutrition. DSM has enormous respect for Martek's products,
organization and people. We look forward to working with their
highly skilled team.
"This acquisition is an attractive and logical next step for
DSM. Martek's leading position in healthy, natural ingredients and
algal technology will add a new growth platform to our Nutrition
business. DSM is a unique partner for Martek and, with our strong
track record of growing businesses in competitive environments, we
believe we can help to lift Martek to the next level."
Martek's Chairman, Robert J.
Flanagan, said:
"We are proud of the achievements of our company and are
pleased to see the company's value recognized by DSM. Following
thorough analysis by our board of directors, we have determined
that this transaction offers the best value for our
stockholders."
Martek's CEO, Steve Dubin,
said:
"We are pleased to announce this transaction, and we believe
that it is in the best interest of Martek and our stockholders.
After careful analysis, our board of directors unanimously
approved this transaction with DSM, which has a strong reputation
and global operations. We are pleased that this transaction
appropriately recognizes the value of Martek's nutritional
ingredients, technology platform, market position and skilled
workforce, while providing significant value to our
stockholders. We have worked collaboratively with DSM for
many years, and we are confident that they share our vision for
Martek's future."
Conference calls
Today DSM will hold a conference call for the media from
08.30 AM – 09.00 AM CET (+31 (0)10 29 44 224 or +44 (0) 203
365 3207) and a conference call for investors and analysts from
09.30 AM – 10.30 AM CET (+31 (0)10 29 44 271 or +44 (0) 203
365 3207). Also, more information can be found in the presentation
that can be downloaded from the Investors section of the DSM
website www.dsm.com. The calls will be recorded and will be
available for replay on www.dsm.com.
Additional information
Allen & Company LLC is serving as exclusive financial
advisor to Martek in the transaction. Hogan Lovells US LLP is
serving as legal counsel to Martek and Morris, Nichols, Arsht &
Tunnell LLP is serving as legal counsel to Martek's independent
directors. JP Morgan plc is serving as financial advisor to DSM,
and Cleary Gottlieb Steen &
Hamilton LLP is serving as legal counsel to DSM.
DSM – the Life Sciences and Materials Sciences
Company
Royal DSM N.V. creates solutions that nourish, protect and
improve performance. Its end markets include human and animal
nutrition and health, personal care, pharmaceuticals, automotive,
coatings and paint, electrical and electronics, life protection and
housing. DSM manages its business with a focus on the triple bottom
line of economic performance, environmental quality and social
responsibility, which it pursues simultaneously and in parallel.
DSM has annual net sales of about euro 8
billion and employs some 22,700 people worldwide. The
company is headquartered in the
Netherlands, with locations on five continents. DSM is
listed on Euronext Amsterdam. More information: www.dsm.com
Martek
Martek is a leader in the innovation, development, production
and sale of high-value products from microbial sources that promote
health and wellness through nutrition. The Company's technology
platform consists of its core expertise, broad experience and
proprietary technology in areas such as microbial biology, algal
genomics, fermentation and downstream processing. This technology
platform has resulted in Martek's development of a number of
products, including the company's flagship product,
life'sDHA™, a sustainable and vegetarian source of algal DHA
(docosahexaenoic acid) important for brain, heart and eye health
throughout life for use in infant formula, pregnancy and nursing
products, foods and beverages, dietary supplements and animal
feeds. The Company also produces life'sARA™ (arachidonic
acid), an omega-6 fatty acid, for use in infant formula and
growing-up milks. Martek's subsidiary, Amerifit Brands, develops,
markets and distributes branded consumer health and wellness
products and holds leading brand positions in all of its key
product categories. Amerifit products are sold in most major mass,
club, drug, grocery and specialty stores and include: Culturelle®,
a leading probiotic supplement; AZO, the leading OTC brand
addressing symptom relief and detection of urinary tract
infections; and Estroven®, the leading all-natural nutritional
supplement brand addressing the symptoms of menopause.
For more information on Martek Biosciences, visit
www.Martek.com. For a complete list of life'sDHA™ and life'sARA™
products, visit www.lifesdha.com. For more information about
Amerifit Brands, visit http://www.amerifit.com.
For more information:
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DSM Corporate
Communications
Herman Betten
tel. +31 (0) 45
5782017
fax +31 (0) 45
5740680
e-mail media.relations@dsm.com
Brunswick Group
Jennifer Lowney/Justin
Dini
Tel +1 212 706 7889
e-mail dsm@brunswickgroup.com
Martek Corporate
Communications
Cassie France-Kelly
Tel. +1 443-542-2116
e-mail media@martek.com
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DSM Investor
Relations
Hans Vossen
tel. +31 (0) 45
5782864
fax +31 (0) 10
4590275
e-mail investor.relations@dsm.com
Brunswick Group
Kate Miller/Jonathan
Glass
Tel +44 20 7396 3544
e-mail dsm@brunswickgroup.com
Martek Investor
Relations
Kyle Stults
Tel. +1 443-542-2565
e-mail investors@martek.com
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Additional Information
The tender offer described in this new release has not yet been
commenced. This news release and the description contained
herein is neither an offer to purchase nor a solicitation of an
offer to sell shares of Martek. At the time the tender offer is
commenced, DSM and its wholly-owned subsidiary, Greenback
Acquisition Corporation, intend to file a Tender Offer Statement on
Schedule TO containing an offer to purchase, a form of letter of
transmittal and other documents relating to the tender offer and
Martek intends to file a Solicitation/Recommendation Statement on
Schedule 14D-9 with respect to the tender offer. DSM, Greenback
Acquisition Corporation and Martek intend to mail these documents
to the stockholders of Martek. These documents will contain
important information about the tender offer and stockholders of
Martek are urged to read them carefully when they become available.
Stockholders of Martek will be able to obtain a free copy of these
documents (when they become available) and other documents filed by
Martek, DSM or Greenback Acquisition Corporation with the
Securities and Exchange Commission at the website maintained by the
SEC at www.sec.gov. In addition, stockholders will be able to
obtain a free copy of these documents (when they become available)
from the information agent named in the offer to purchase or from
DSM.
Forward Looking Information
This presentation contains certain forward looking statements
that involve a number of risks and uncertainties. Such
statements are qualified by the inherent risks and uncertainties
surrounding future expectations generally, and also may materially
differ from actual future experience involving any one or more of
such statements. Such risks and uncertainties include:
uncertainties as to the timing of the tender offer and merger;
uncertainties as to how many Martek stockholders will tender their
stock in the offer; the risk that competing offers will be made;
the possibility that various closing conditions for the transaction
may not be satisfied or waived, including that a governmental
entity may prohibit, delay or refuse to grant approval for the
consummation of the transaction; any conditions imposed in
connection with consummation of the tender offer and the merger;
satisfaction of various other conditions to the completion of the
tender offer and the merger contemplated by the merger agreement;
and other risk factors as set forth from time to time in DSM's
Annual Report and in filings with the SEC including, but not
limited to, Part I, Item 1A of Martek's Form 10-K for the fiscal
year ended October 31, 2009, other
Martek reports on Form 10-K, Form 10-Q and Form 8-K and, when made,
DSM's Schedule TO and related documentation and Martek's Schedule
14D-9 to be filed in connection with the tender offer. The
inclusion of a forward-looking statement herein should not be
regarded as a representation by DSM or Martek that DSM's or
Martek's objectives will be achieved. DSM and Martek undertake no
obligation to publicly update forward-looking statements, whether
as a result of new information, future events or otherwise.
The English language version of this press release supersedes
all other language versions.
SOURCE Martek Biosciences Corporation