Darling International buys Dutch meat byproducts recycler for $2.2 billion

Darling International Inc., a leading provider of rendering, recycling and recovery solutions to the nation's food industry, announced that it has entered into a definitive agreement to acquire the shares (other than certain minority interests) of Vion Ingredients, a division of Vion Holding N.V. (a member of the Vion Food Group), for approximately €1.6 billion ($2.2 U.S. billion) in cash. Closing is anticipated in January 2014 subject to customary regulatory approvals and finalization of the required employee consultations in the Netherlands.

Vion Ingredients is a worldwide leader in the development and production of specialty ingredients from animal origin for applications in pharmaceuticals, food, feed, pet food, fertilizer and bio-energy. Vion Ingredients' global network of 58 facilities on five continents covers all aspects of animal by-product processing through six brands including Rendac (rendering), Sonac (proteins, fats, edible fats and blood products), Ecoson (green power), Rousselot (gelatin), CTH (natural casings), and Best Hides (hides).

Vion Ingredients was formed in 1930 and is headquartered in Son en Breugel, the Netherlands. Vion Ingredients employs approximately 5,700 people with revenues of approximately €1.6 billion and €200 million in EBITDA for FY2012. For the trailing 12 months through June 30, 2013, reported revenues were €1.687 billion with approximately €210 million of EBITDA.

Vion Ingredients' rendering business has leading positions across Europe with operations in the Netherlands, Belgium, Germany, Poland and Italy under the Rendac and Sonac brand names. Value added products include edible fats, blood products and plasma meals, bone products, protein meals and fats. Rousselot is the leading market provider of gelatin for the food, pharmaceuticals, and pet food industries with operations in the United States, Europe, South America and China. CTH is a market leader in natural casings for the sausage business with operations in the United States, Europe and China.

Randall C. Stuewe, Darling International's Chairman and CEO said, "Our vision of creating a sustainable ingredients business for a growing population is well on its way. The combination of Vion Ingredients with Darling International will create the global leader in converting edible and inedible bio-nutrients streams into specialty products and ingredients for the food, feed, fuel, fertilizer and pharmaceutical industries. We are truly excited to have the opportunity to join forces with the Vion Ingredients management team and bring this transformational platform to our suppliers, customers and employees. Furthermore, this transaction will further diversify Darling International's revenue and EBITDA profile both geographically and from a product line point of view. "

Vion Ingredients, its brands and geographies will continue to be led by CEO Dirk Kloosterboer. In addition to his current responsibilities, upon closing, Dirk will be named Chief Operating Officer of Darling International and be appointed to the Darling International Board of Directors. Dirk Kloosterboer commented, "We are very excited to become part of the Darling International group and its heritage. Under its new ownership, we will be able to execute our growth ambitions and provide our employees, customers and suppliers with a unique global platform, driving further product innovation and penetration of new markets."

Darling plans to finance the transaction through a combination of bank debt, public debt and equity, and expects this purchase, excluding one-time charges, before synergies, and pro forma for financing to be immediately accretive to earnings per share. The Company was exclusively advised by J.P. Morgan Securities LLC. J.P. Morgan Securities LLC, Goldman Sachs, and BMO Capital Markets provided committed financing in support of the transaction. K&L Gates and Clifford Chance served as legal counsel.

Source: Darling International

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