Darling International to acquire Vion Ingredients

Deal valued at €1.6 billion expected to close in early 2014

Darling International, a leading provider of rendering, recycling and recovery solutions to the nation’s food industry, has entered into a definitive agreement to acquire the shares of Vion Ingredients for about €1.6 billion. Closing is anticipated in January 2014, and is subject to customary regulatory approvals and finalization of the required employee consultations in the Netherlands.

Vion Ingredients is a developer and producer 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, Netherlands. The company employs approximately 5,700 people with revenues of approximately €1.6 billion. For the trailing 12 months through June 30, 2013, reported revenues were €1.687 billion.

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 U.S., Europe, South America and China. CTH is a market leader in natural casings for the sausage business with operations in the U.S., Europe and China.

“Our vision of creating a sustainable ingredients business for a growing population is well on its way,” said Randall C. Stuewe, Darling International’s chairman and CEO. “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, Kloosterboer will be named chief operating officer of Darling International and will be appointed to the Darling International board of directors. “We are very excited to become part of the Darling International group and its heritage,” said Kloosterboer. “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.