EU Clears DuPont's Danisco Acquisition

DuPont cleared a hurdle in its bid to buy Danish group Danisco by gaining European Union approval, but doubts about the agreed $6.4 billion deal linger after low acceptance by Danisco owners.

The U.S. chemicals group said on Tuesday the European Commission had approved its tender offer for Danisco, the Danish food ingredients and enzymes maker, and it expected to close the transaction this month.

"Only Chinese approval now remains as a regulatory condition of closing," chief executive Ellen Kullman said.

DuPont and Danisco announced the agreed takeover in January, but acceptance by Danisco shareholders of the 665 Danish crowns per share offer worth 33.4 billion Danish crowns ($6.4 billion) has been sluggish while regulatory hurdles have been pending.
DuPont has twice extended the offer, most recently on March 30, when it prolonged it to April 29 after Danisco shareholders with only 6%  of the stock had accepted the bid.

That was far below the 90% acceptance that DuPont requires to complete the deal and delist Danisco.

"We remain confident that Danisco shareholders will follow their board's recommendation to accept our premium cash offer, and the transaction will be completed later this month," Kullman said in the statement.

But analysts said DuPont would still have an uphill battle to carry out the deal.

"I think they will have difficulties obtaining the 90% (acceptance level) with the current bid," Handelsbanken Capital Markets analyst Dan Togo Jensen said.

"They would get a better chance if they raised the bid because of the stronger-than-expected underlying performance of Danisco," Jensen said, adding he also expected there was a chance DuPont would raise its offer.

The U.S. company has repeatedly said it will not raise the bid, which it has called "full, fair and firm."
Competition approval for the deal has earlier been obtained in the United States.