DuPont and Bunge Looking to Sell Solae Business – Reports

The sale may fetch about $1.4 billion to $1.75 billion based on Solae’s annual earnings of about $180 million before interest, tax, depreciation and amortization.

Jul 27 2011 --- Solae LLC, the soy joint venture, between DuPont and Bunge is reportedly up for sale, according to a report from Bloomberg, which cited three people with knowledge of the matter. Neither Molly Cornbleet, a spokesperson at Solae or Susan Burns at Bunge would “respond to market rumors” when asked to comment by FoodIngredientsFirst. DuPont owns 72 percent of Solae, while Bunge owns the remaining stake.

According to the report, Solae management this month began meeting with potential bidders, including private-equity funds and European strategic buyers, said two of the people, who asked not to be identified because the process is private. The sale may fetch about $1.4 billion to $1.75 billion based on Solae’s annual earnings of about $180 million before interest, tax, depreciation and amortization, two people were reported as saying.

The reports come shortly after DuPont completed its $6.44 billion acquisition of Danisco last month, as the company looks to focus on specialty products and may look to move away from lower margin businesses. DuPont in May said it would create a new reporting unit merging Danisco’s food ingredients business with the nutrition and health unit, which includes St. Louis-based Solae. DuPont announced the formation of two new business units, Industrial Biosciences and Nutrition & Health. The company has appointed Craig F. Binetti as the President of the new Nutrition & Health business and James C. Collins, Jr. as President of Industrial Biosciences. Richard C. Olson will assume responsibility for ongoing integration of Danisco across both new businesses units.

DuPont Chair and CEO Ellen Kullman said at the time of the acquisition. "This combination will create an industry leader in industrial biosciences and nutrition and health. These businesses will work together to drive sustainable growth and market-driven innovation by linking agriculture, nutrition and advanced materials through industrial biosciences," Kullman said. "In addition, the R&D combination of DuPont, Danisco and Genencor will enable us to further respond to global megatrends and help provide for the food, energy and protection needs of a growing population."

Solae is promoted as the world leader in developing innovative soy-based technologies and ingredients for food, meat and nutritional products. With more than 1,000 products used by more than 3,500 customers, Solae's soy ingredients are used in applications around the world in products such as baked goods, beverages, nutrition bars, meats, vegetarian meals and much more. Customers include soymilk maker 8th Continent, created as a joint venture between DuPont and General Mills Inc. in 2000 and sold to Stremicks Heritage Foods in 2008.