DuPont’s $5.8 Billion Danisco Bid Rejected by Danish Investor

DuPont Co.’s $5.8 billion offer for Danisco A/S, the world’s largest food-ingredients maker, was rejected by a Danish shareholder as too low.

Hans Dam, a spokesman for AP Pension, confirmed the fund’s rejection in a telephone interview today. Copenhagen-based AP owns less than 0.5 percent of Danisco, he said. SEB Asset Management, which has a stake of about 2 percent in Danisco, also turned down the offer, Boersen newspaper said Jan. 31.

DuPont agreed to pay 665 kroner ($123) a share for Danisco, 25 percent higher than the Danish company’s closing share price on Jan. 7, the last day’s trading before the deal was announced. Danisco fell 4 kroner to 656 kroner in Copenhagen trading today.

DuPont Chief Executive Officer Ellen Kullman made the bid five months after Danisco lifted a cap on shareholder voting rights. Wilmington, Delaware-based DuPont plans to buy the company for its production of enzymes used in biofuels.

The offer expires Feb. 22 and is contingent on the acceptance of investors holding more than 90 percent of shares. The bid is fair and won’t be raised, Michael Hanretta, a DuPont spokesman, said today.

ATP, Denmark’s largest pension fund and the owner of a 5 percent Danisco stake, may take weeks to review the deal, ATP Chief Investment Officer Henrik Gade Jepsen said.

“We’re still in a phase where we’re analyzing the bid,” Jepsen said in an interview. “We still have a few weeks to ponder.”

DuPont will complete the acquisition and can pay 690 kroner to 720 kroner without diluting its earnings per share in 2012 and 2013, SEB Enskilda said in a Jan. 31 note.

Rival Suitors

Danisco attracted more than one suitor, Chairman Jorgen Tandrup said Jan. 10. Royal DSM NV, which built a 4.95 percent stake in Danisco, on Jan. 12 ruled out a counterbid. Belgium’s Solvay SA, which raised $7.1 billion from the sale of a drugs unit in September, was outbid by DuPont, Boersen said Jan. 12.

DuPont is paying 11.1 times Danisco’s earnings before interest, tax, depreciation and amortization, according to data compiled by Bloomberg. That compares with the median of 8.1 times ebitda based on nine food-industry deals from the past 10 years.

JPMorgan Chase & Co. and legal firms Skadden Arps Slate Meagher & Flom LLP and White & Case LLP are advising DuPont. Deutsche Bank AG is advising Danisco.

To contact the reporters on this story: Christian Wienberg in Copenhagen at cwienberg@bloomberg.net; Jack Kaskey in New York at jkaskey@bloomberg.net

To contact the editors responsible for this story: Tim Quinson at tquinson@bloomberg.net; Simon Casey at scasey4@bloomberg.net

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