Management committed to divesting the business but seem flexible on timeframe
Heerlen, The Netherlands – DSM is on track with plans to sell-off its Materials business to focus on its health, nutrition and bioscience units, according to officials of the Dutch group.
But asked about the timeframe for the divestment announced last September, Dimitri de Vreeze, co-CEO and member of the managing board was far from concise.
Basically, it's an open question," de Vreeze said in a 15 Feb conference call with analysts to discuss the group's full-year financial results for 2021.
"When we announced it in September, we said this will not be a process of months, but it will not be a process of years either. Within that time schedule, we're still on track."
In terms of interest, de Vreeze said Materials was attracting potential buyers even before DSM announced that it was looking for a new owner.
And, with the current 2021 results, the level of interest has "been more positive" the co-CEO added. "The 2021 results show that it's a really good business "
DSM's Materials units posted a 60% year-on-year increase in earnings (adjusted EBITDA) to €435 million on 2021 sale of €1,935 million - 27% higher than a year ago.
The revenue gains included increases of 14% related to both volumes and price/mix, according to the Dutch group's financial statement.
On 14 Sept 2021, DSM announced that it was reviewing strategic options for the two businesses within its Materials division, including a possible change of ownership.
The division portfolio includes engineering materials, with products such as thermoplastic elastomers (TPEs), polyamides and speciality polyesters.
Among other products, the unit supplies Arnitel-branded TPEs for various applications including in the automotive, medical and industrial sectors.
The division's protective materials business is claimed to be the world's largest manufacturer of ultra-high molecular weight polyethylene fibre-based products.
Comments sourced from transcript produced by Seeking Alpha.
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