Dutch bioscience and foods company DSM has announced the sale of its engineering materials subsidiary for €3.85 billion to private equity firm Advent International and German chemicals company Lanxess.
The announcement came shortly after DSM said it intended to merge with Swiss peer Firmenich.
Advent and Lanxess plan to combine DSM's engineering materials business with Lanxess' high performance materials business under a joint venture in which Advent will own a 60% stake and Lanxess a 40% stake.
"We are forging a strong global player in the field of high-performance plastics," Lanxess CEO Matthias Zachert said in a statement. "The portfolios, value chains and global positioning of the two businesses complement each other perfectly."
DSM has been in the process of selling its materials division since September. DSM co-chief executive Geraldine Matchett had said at a press conference early on Tuesday about the Firmenich merger she expected more news on the engineering subsidiary "soon".
The DSM engineering division manufactures high-density polyethylene thermoplastics used in food packaging to electronics.
DSM had said it considered the operations non-core as it plans to focus on health and nutrition business.
"We are certain Advent International and Laxness will be good new owners in a transaction that is strategically attractive for all parties as we focus DSM on improving people’s health and well-being," said Geraldine Matchett and Dimitri de Vreeze, Co-CEOs of DSM.
"DSM has a track record of successful transformation over the past half century, and we are well underway in another such moment of strategic change.”