Diana acquisition sees German aroma group Symrise move into aquafeed

Private equity groups and Japanese company, Ajinimoto, were also reported to be bidding for Diana but the listed German aroma chemicals firm won the battle for the Brittany-based company.

In 2013, Diana had sales of around €425 million and an EBITDA (earnings before interest, taxes, depreciation and amortization) margin of about 21 percent.

The deal allows Symrise tap into new lucrative business segments such as pet food and feed for aquaculture, with the global market for aquafeed alone expected to reach $133 bn by 2020.

Functional hydrolysates​

Diana, through its Aquativ portfolio, supplies the farmed fish and shrimp sector with a range of functional hydrolysates in liquid, concentrate and powder form obtained from marine raw material sources including krill, squid, tilapia and shrimp.

Bernhard Kott, communications spokesperson at Symrise, told FeedNavigator.com that the German group has to get a “better understanding​ of the opportunities​” arising out of Diana’s aqua feed business before it can define its strategy for the division. 

But he said Symrise sees the Aquativ product line as offering great growth potential, and the intention, at this juncture, is to build on the feed division’s existing strengths. 

Fish and shrimp health​

Diana’s aquafeed business produces functional hydrolysates – ingredients produced through the hydrolysis of marine raw materials.

They are currently used at 2 to 10 percent in diets, depending on the feed segment, said the company.

The higher levels of peptides and free amino acids in the hydrolysates, said the French firm, bring added value to feeds by improving fish and shrimp health, therefore lowering mortality.

“The enzymatic digestion of the raw material improves the nutrients digestibility and peptide availability increasing feed assimilation and attractiveness,”​ says Diana-Aquativ.

The aquafeed division initiated new operations in Costa Rica and Ecuador in 2012, to produce hydrolysates in both liquid and spray dried powder from farmed tilapia and shrimp.

In the same year, Diana-Aquavit signed a strategic alliance with a Norwegian company, Olympic Seafood, to produce krill-derived functional hydrolysate.

Natural ingredients diverisification ​​

Symrise CEO Dr Heinz Jürgen Bertram said: "Diana Group is an impressive and highly profitable business with a strong complementary fit to our activities."​

The acquisition of the Vannes headquartered group, he added, will help to “significantly diversify”​ Symrise's portfolio for natural ingredients, strengthen its raw material supply and help to improve traceability in its supply chain.

The CEO told reporters today that Symrise would most likely fund the purchase of Diana through 10 percent capital increase, as well as a mix of debt and equity. 

The purchase, expected to complete in the third quarter, values the French flavour and ingredients firm at about 14 times its EBITDA. The combined company will generate sales of almost €2.3bn.

"We believe that a multiple of around 14 times EBITDA (2013) represents an attractive valuation, given the quality of Diana's product and customer base, its high-margin characteristics, and the future growth prospects of the business,"​ said Dr Bertram.