DSM Acquires Valley Research to Strengthen Food Enzymes Activities

Valley Research Inc., a privately held biotechnology company founded in 1984, offers a broad range of enzymes, supported by technical laboratories and excellent production facilities.

11/07/08 Royal DSM N.V., the global Life Sciences and Materials Sciences company headquartered in the Netherlands, today announces the acquisition of the business and substantially all of the assets of Valley Research Inc. of South Bend Indiana, United States. Through this acquisition, DSM further reinforces its leading global position in food enzymes.

The acquisition has been finalized. Terms of the acquisition will not be disclosed now, as agreed between the parties.

Valley Research Inc., a privately held biotechnology company founded in 1984, offers a broad range of enzymes, supported by technical laboratories and excellent production facilities. Its products are used in dietary supplements, dairy, juices and wines.

DSM Valley Research, Inc. will become part of DSM Food Specialties, a global leader in ingredient solutions for the food and beverage industries. The market for bio-ingredients, including food enzymes, has shown continuous volume growth in recent years, driven by a growing demand for healthy nutrition such as low-salt and low-fat foods, food safety, convenience and the need for natural ingredients.

The acquisition of Valley Research enables DSM Food Specialties to strengthen its product portfolio, while at the same time the company can now offer regional blending and solution providing platforms to customers.

Stephan Tanda, member of the Managing Board of DSM, commented: “Our sales in food enzymes have shown strong growth in recent years. It remains a very interesting growth area for DSM and is one of the ingredients in reaching our targets as set out in Vision 2010 – Building on Strengths. This acquisition of Valley Research will reinforce our leading global position in food enzymes and I expect Valley Research to generate additional value for our customers and shareholders”

Art Sears, President of Valley Research said: “By joining DSM, we are convinced we have chosen the best company to take our know-how and products to the next level, assuring uninterrupted service for our customers and a new platform for further growth”. After the acquisition Mr. Sears will stay involved with DSM Valley Research’s food enzymes business as an advisor.

DSM Food Specialties’ leading enzyme and fermentation technology, combined with its application knowledge, enables the company to develop enzymes that help customers to achieve their manufacturing goals. Enzymes can ensure cost savings and promote a more sustainable way of producing by improving processing efficiency, replacing physical and chemical treatments, reducing energy needs and using fewer raw materials.

“The food enzymes market is very important to DSM, and one in which we have a strong global position”, says Alexander Wessels, Business Group Director of DSM Food Specialties. “This acquisition is a valuable addition to our company and strengthens us in servicing our customers even better by offering regional blending and solution providing platforms. DSM Valley Research, Inc. will operate as a separate entity within DSM Food Specialties. This will guarantee continuation of superior services towards Valley Research customers, whilst in addition access is provided to the innovation strengths of DSM”.

Enzymes are biocatalysts used to help speed up or slow down chemical reactions that are contained in every living organism. They function as a natural catalyst for a biochemical reaction, without being changed or diminished. Enzymes are, for the most part, derived from fungal and bacterial organisms, with some products coming from plant sources, such as papaya or pineapple.