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Food Ingredients

DSM forms vitamin E joint venture in China

Firm seeks to enhance its position in animal nutrition

by Marc S. Reisch
January 30, 2019 | APPEARED IN VOLUME 97, ISSUE 5

 

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DSM will spend $154 million for a 75% share in a new Chinese vitamin E joint venture. The move will give the Netherlands-based firm access to a cost-effective source of the vitamin for its growing animal nutrition business.

Used in vitamin premixes, Vitamin E is an antioxidant that contributes to disease resistance in farm animals.

The deal, with China’s Nenter, should close by September after which the venture will exclusively supply Vitamin E to DSM. Nenter, which will own 25% of the venture, will contribute production facilities in Jingzhou and Shishou, China, both in Hubei province. The partners plan to refurbish the two facilities to bring them up to safety, health, and sustainability standards.

DSM also says the venture will enlarge its footprint in Asia and complement its existing Vitamin E facility in Switzerland. The venture will also add to DSM’s animal nutrition business, which DSM says is growing 8% annually.

Nenter and DSM share an interest in low-cost fermentation methods to produce vitamins. Several years ago, the industrial biotech firm Amyris and Nenter had a partnership to make Vitamin E. Amyris supplied sugar-based farnesene for the effort. In 2017, DSM took a license from Amyris to develop farnesene as a source for making Vitamin A.

By the end of 2017, DSM had purchased Amyris’s farnesene production facility for $96 million. DSM inherited a Nenter farnesene supply agreement as part of the deal.

At press time, DSM hadn’t responded to C&EN’s inquiries about its success in making vitamin A from farnesene or about Nenter’s progress in making farnesene-based vitamin E.

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