International private equity firm Cinven today announces that it has signed an agreement with Bayer AG (ETR: BAYN) to acquire its Environmental Science Professional business for a total enterprise value of $2.6 billion (~€2.4 billion).
Bayer Environmental Science Professional (BESP) is a leading global provider of products and services to create healthier environments, to manage pests, and to eliminate vector-borne diseases, across a range of end-markets. BESP has an extensive product portfolio to manage pests (such as rodents, pest insects and invasive weeds) in a sustainable and responsible manner, including for the vegetation management, range and pasture, forestry and turf and ornamentals markets. In addition, BESP markets products to protect against vector-borne diseases such as malaria, and to promote public health objectives in the developing world.
Headquartered in Cary, North Carolina, USA, BESP has global operations with c. 800 employees and c. 2,000 product registrations, sold in more than 100 countries. BESP also has market-leading R&D capabilities, with four international R&D centres and more than 200 employees working in product innovation.
Cinven has longstanding relationships with large corporates in the Industrials sector, particularly in Germany and the DACH region, and an extensive track record of carving out businesses responsibly for all stakeholders, allowing Cinven to identify attractive opportunities and create new successful standalone companies.
Cinven’s Industrials Sector and DACH teams see BESP as an attractive investment opportunity, given the business’:
- Resilient, growing and diversified end-markets, addressing an increasing societal demand for pest control and healthier, disease-free environments driven by higher living standards, urbanisation and climate change;
- Leading market positions, underpinned by its strong science-led R&D capabilities, regulatory and Intellectual Property (‘IP’) protections;
- Strong brands with an opportunity to accelerate organic growth through expansion into new geographies and new market segments;
- Product portfolio with clear social and environmental benefits, consistent with the focus of Cinven’s ESG strategy, including products for improving public health outcomes, fighting vector-borne disease, controlling pest infestations, and reducing wildfire risks;
- Longstanding relationships with professional customers, supported by its leading technical service capabilities;
- Significant growth opportunities through further investment in R&D and in-licensing external IP to develop new sustainable products for pest management, including biological and digital technologies;
- Consolidation opportunities in the fragmented specialty pest management sector through buy and build M&A; and
- Experienced international leadership team, led by CEO Gilles Galliou, with responsibility for a highly qualified, high-performing global employee base.
Pontus Pettersson, Partner at Cinven, commented:
“Cinven is delighted by the opportunity to invest in Bayer Environmental Science Professional, a global leader in specialty pest management that serves critical needs for society across a broad range of end-markets. Cinven is excited to build an independent, focused company, and to extend BESP’s product portfolio further by creating innovative and sustainable solutions for its customers.
“Following Cinven’s recent acquisitions of TK Elevator and Arxada, Cinven is confirmed as a preferred partner for large European corporates on significant disposals, especially within the Industrials sector. Bayer has been an exemplary custodian of the business, and we look forward to continued close collaboration between BESP and Bayer.”
Anthony Cardona, Partner at Cinven, added:
“Bayer Environmental Science Professional enjoys strong positions in multiple markets across the world, driven by its best-in-class scientific and regulatory teams, well regarded brands, and leading technical service capabilities. Cinven has been impressed by the quality of the team and operations, and this transaction should create significant opportunities across the business.
“Cinven shares management’s ambitious growth agenda and views BESP as a platform investment, with scope to grow the business significantly and broaden its product portfolio through acquisitions and strategic partnerships.”
Gilles Galliou, CEO of BESP, added:
“Everything we do at Environmental Science Professional is guided by our vision of healthy environments for everyone everywhere. Cinven clearly shares this vision for our organisation and Cinven has demonstrated that it is committed to the long-term success of our business and would be a great home for our employees.
“With the support and backing of Cinven, I am thrilled for the opportunity for Environmental Science Professional to become even more growth-oriented, with a full focus on advancing innovations that meet the unique and evolving needs of our customers around the world.”
Cinven is one of the leading investors in carve-outs from Industrial companies in Europe. The Cinven funds’ investment in BESP, acquired from the German-listed Bayer AG, builds on its recent experience of carving out TK Elevator from thyssenkrupp AG and Arxada (formerly Lonza Specialty Ingredients) from Lonza Group AG.
Cinven is also one of the most active and successful investors in Germany and the wider DACH region. Other recent investments of Cinven funds in Germany include STADA, Synlab, think-cell and Viridium.
Cinven is a responsible, ESG-focused investor, and committed to maintaining the environmental, regulatory and employee stakeholder responsibilities of BESP. Under the Cinven funds’ ownership, BESP will remain an important partner of Bayer AG and will collaborate closely with Bayer going forward in several areas.
