Verenium Corp., San Diego, Calif., an industrial biotechnology company focused on high-performance enzymes, closed its transaction with DSM Food Specialties B.V., a business group of Royal DSM. Verenium sold DSM its oilseed processing business, licensed certain enzymes for use in the food and beverage markets, and will allow access to new gene libraries it develops.
Verenium will receive $37 million in total consideration.
Verenium has developed a number of high-performance enzyme products and product candidates for use in industrial processes. Verenium''s enzyme products minimize pollution by reducing or replacing harsh chemicals used in industrial processes, while also enhancing yields in their customers'' processes, DSM says.
Following the transaction, Verenium says its business remains focused on providing novel enzymes in the areas of animal health and nutrition, grain processing and oilfield services.
Verenium has granted DSM exclusive licenses to its alpha-amylase and xylanase enzyme products for use in the food and beverage markets. Verenium retains certain rights to these products in markets outside of the food and beverage markets.
The products acquired by DSM represented approximately $7.5 million in revenue to Verenium in 2011.
"We are pleased to have secured this capital without issuing new shares, and believe we have positioned ourselves to create value for shareholders. As a result of this transaction, we are able to retire our remaining debt and create a capital structure appropriate for our business," says Jeff Black, Verenium CFO.
DSM says the purchase strengthens and broadens its enzymes business and capabilities, including in industrial biotech activities, and reinforces its food enzymes innovation pipeline.
In addition, DSM will have access to the newly developed bio-diversity collection and library being created by Verenium. By extracting microbial DNA directly from collected samples the slow and often impossible task of culturing individual microbes in a laboratory is avoided. Utilizing ultra high- throughput screening technologies, Verenium mines its collection of billions of microbial genes in search of unique enzymes.
"This acquisition will broaden our enzymes business and fits very well in our strategy of continued value growth for our Nutrition cluster. It will also further support our leading industrial biotechnology position," Stephan Tanda, member of the DSM managing board, says.