From San Diego Deal, DSM Plans Industrial Biotechnology Expansion

Royal DSM, the Dutch multinational industrial conglomerate, officially opened a new office in San Diego yesterday, exactly one year after acquiring food enzymes and oilseed processing assets from San Diego-based Verenium in a deal valued at $37 million.

While the DSM outpost in Southern California has only a dozen employees, including eight from Verenium, it represents a focal point of growth for a company that officially began in 1902 as the “Dutch States Mining” company. Since then, DSM’s corporate strategy has shifted from mining coal to producing petrochemicals, refined chemicals, materials—and now life sciences (including industrial biotechnology), which now accounts for about 60 percent of the company’s $11 billion in global revenue.

The company, which has more than 24,000 employees, says it has acquired 10 companies in health, nutrition, and materials since it formally adopted a new life sciences strategy in September 2010. In addition to last year’s deal with Verenium, DSM has acquired dairy enzymes and culture assets from Cargill, a Brazilian nutritional supplements business for cattle, a New York food nutrition company, Ocean Nutrition Canada, and Kensey Nash, a regenerative medicine and biomaterials business based in Pennsylvania.

DSM acquired Verenium’s oilseed processing business, including proprietary enzymes used to extract oils from soybeans, canola, and sunflower seeds. The company plans to expand its San Diego-based business, according to Hans-Christian Ambjerg, who oversees DSM Food Specialties from the company’s headquarters in the Netherlands.

“We help our customers to increase their yield in a sustainable way,” says Ambjerg, who tells me he was deeply involved in the San Diego acquisition. DSM has said the global crop-based oil market is expected to grow by 50 percent annually in coming years, with the overall market potential estimated at more than $350 million. DSM also acquired exclusive worldwide licenses to two enzymes (alpha-amylase and xylanase) used in the food and beverage markets, and says the market for food enzymes alone is more than $1.3 billion.

“From a San Diego point of view, we are very excited about this opportunity and have a strong commitment to build our presence here,” Ambjerg says.

Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.