Novozymes acquired EMD/Merck Crop BioScience

Novozymes, Copenhagen, Denmark, today announced the acquisition of EMD/Merck Crop BioScience from Merck KGaA. With its third acquisition in the agricultural biologicals sector in as many years Novozymes is further demonstrating its commitment to develop sustainable solutions for this sector.

The deal complements Novozymes' existing agricultural biologicals products and markets, and it offers additional potential for the combined company.

Headquartered in Milwaukee, Wisconsin, the majority of EMD/Merck Crop BioScience's activities are undertaken in North and South America. The total consideration to be paid to Merck KGaA is USD $275 million, subject to customary post-closing adjustments.

EMD/Merck Crop BioScience has approximately 165 employees and has generated average annual sales growth of roughly 15% during the last seven years. It is expected to generate sales of USD 60 million in 2010 and will support Novozymes' long-term sales growth expectation of more than 10%. EMD/Merck Crop BioScience's EBIT margin supports Novozymes' long-term EBIT margin expectation of more than 20%.

"The acquisition of EMD/Merck Crop BioScience strengthens our global position in the growing industry for agricultural biologicals providing products that enhance the natural growth and yield of crops," says Steen Riisgaard, CEO of Novozymes.

"We have found in EMD/Merck Crop BioScience a company that has a strong strategic fit with our existing BioAg business. In brief, it has a complementary product range and geographical scope, a strong R&D pipeline, and very talented people. Together we can utilize Novozymes' unique biotechnology platform to bring a new level of innovation to the market."

EMD/Merck Crop BioScience's products and technologies are well defined and established, with documented and proven efficacy gains on numerous soils and crops. The company's product portfolio focuses on biological growth enhancers and nitrogen inoculants primarily used in the production of soybean and pulses, thus supplementing Novozymes' existing nitrogen and phosphate inoculants business.

Inoculants, also known as biofertilizers, are microorganisms that can significantly improve the ability of plants to fix nitrogen and utilize phosphate, which are essential to their growth, thereby significantly improving the efficiency of chemical fertilizers. The global biofertility market is currently estimated to be worth around USD $250 million.

Bringing a new level of innovation to agriculture

"Novozymes is dedicated to continued innovation in agriculture, thereby enabling farmers to become even more cost and resource efficient," says Steen Riisgaard. "In a world that continuously needs to produce more food for a soaring population without further stressing the environment, farmers need effective but more sustainable ways to grow crops. This has led to a strong interest in biofertilizers and other biotechnological solutions."

Novozymes entered the biofertility market in 2007 with the acquisition of Philom Bios in Canada and has gradually increased its activities, most recently with the acquisition of Turfal in Brazil in August this year. The activities of EMD/Merck Crop BioScience will be integrated into Novozymes' BioAg organization, which is part of Novozymes' BioBusiness division. The acquisition is subject to regulatory approvals and is expected to be completed between February and May 2011.

Merck

Merck is a global pharmaceutical and chemical company with total revenues of EUR 7.7 billion in 2009, a history that began in 1668, and a future shaped by approximately 40,000 (including Merck Millipore) employees in 64 countries. Its success is characterized by innovations from entrepreneurial employees. Merck's operating activities come under the umbrella of Merck KGaA, in which the Merck family holds an approximately 70% interest and free shareholders own the remaining approximately 30%. In 1917 the U.S. subsidiary Merck & Co. was expropriated and has been an independent company ever since.

Novozymes

Novozymes is the world leader in bioinnovation. Together with customers across a broad array of industries we create tomorrow's industrial biosolutions, improving our customers' business and the use of our planet's resources.

With over 700 products used in 130 countries, Novozymes' bioinnovations improve industrial performance and safeguard the world's resources by offering superior and sustainable solutions for tomorrow's ever-changing marketplace. Read more at www.novozymes.com.