DuPont Acquisition Will Strengthen Portfolio, Jefferies Reports

To strengthen its industrial biotech and food platforms, DuPont DD will purchase Danisco for $6.3bn (including $500m of debt), a 25% premium to yesterday's close, Jefferies reports. “The deal represents a $0.30-$0.45 headwind in 2011 and to be modestly accretive in 2012,” Jefferies writes. “We expect DuPont shares to react negatively to integration risk. “Danisco also brings to DuPont's portfolio strong positions in emulsifiers, food stabilisers, cultures (probiotics for humans and natural food protection solutions) and sweeteners (xylitol, fructose and Litesse). These businesses fill in important gaps in DuPont's "farm to fork" strategy while diversifying DuPont's business risk.” DuPont closed Friday at $49.76.