FRANKFURT Germany's Symrise (SY1G.DE), the world's fourth largest scents and flavours company, has made a binding offer to acquire French food ingredient maker Diana Group in a deal that would expand its activities into the pet food market.
Symrise did not disclose the exact purchase price in its statement late on Saturday, saying only that it would "invest" around 1.3 billion euros ($1.8 billion) in the deal to buy all the shares in Kerisper S.A.S., holding entity of Diana Group. Diana is owned by the private equity firm Ardian.
Symrise said it had already secured the bridge financing through a mixture of debt and equity.
In 2013, Diana had sales of around 425 million euros and earnings before interest, tax, depreciation and amortisation (EBITDA) margin of around 21 percent, Symrise said.
Symrise CEO Heinz Juergen Bertram said: "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."
Symrise said the acquisition was expected to be fully EPS-accretive from 2015 onwards and that it expected to finalize it in the third quarter of this year.
The proposed transaction is subject to consultation with the workers' council and to antitrust clearance, it added.
Symrise did not say whether its offer had the approval of Diana's owners, but said the parties had "agreed on exclusivity" while consultation with the workers' council proceeded.
Reuters last month cited sources familiar with the matter as saying that Diana Group had attracted bids worth more than 1.2 billion euros including debt from Symrise and Japan's Ajinomoto (2802.T).
The sources said the buyout firms CVC Capital Partners CVC.UL, Euroazeo and Pamplona were also in the race for the company.
Symrise said Diana, a leading supplier to the food, pet food, nutraceutical, aquaculture and cosmetics industries, would enable it to significantly expand its position in the flavor and nutrition markets and broaden its activities into the pet food markets.
Symrise has sought growth partly via acquisitions, and has recently raised its stake in the Swedish probiotics specialist Probi.
(Reporting by Marilyn Gerlach; Editing by Kevin Liffey)