amsterdam : DSM

June 29, 2011 22:56 ET

DSM strengthens yeast technology leadership for 2G biofuels

HEERLEN, NETHERLANDS--(Marketwire - Jun 29, 2011) - Royal DSM, the global Life Sciences and Materials Sciences company, today announces that it has reached an agreement to acquire C5 Yeast Company B.V.(Bergen op Zoom, Netherlands) from Royal Cosun. The acquisition will allow DSM to combine C5 Yeast Company's business with its own advanced yeast and enzyme technologies for second generation biofuels, further increasing its leadership position in this field. Financial details of the acquisition will not be disclosed. Completion of the transaction is subject to customary approvals and notifications.

DSM already has a unique position in the development of second generation biofuels (cellulosic ethanol derived from agricultural residues and non- edible crops), being the only company capable of offering both enzyme and yeast fermentation technologies to increase conversion rates to make the technology commercially viable. The yield of DSM's advanced yeast technology for second generation bio-fuels on cellulose derived C5/C6 sugars can exceed 90% conversion rate, recent tests have shown.

Microorganisms such as yeast are essential to the biofuel production process as they are needed to convert the fermentable sugars generated by enzymes from biomass into ethanol. There are two primary classes of fermentable sugars that are liberated from cellulosic biomass during hydrolysis, six carbon sugars (C6) and five carbon sugars (C5). Typically yeasts only consume C6 sugars, but DSM's advanced yeast technology is capable of converting both C6 and C5 sugars to ethanol. DSM wants to be the technology provider for the second generation biorefineries, providing enzymes to convert the biomass into a sugar mix and yeast to convert the C6 sugars as well as the C5 sugars. DSM is convinced this will be a winning combination.

C5 Yeast Company has developed a key yeast technology and extensive patent position with its team of R&D experts. The acquisition of C5 Yeast Company adds additional technology for the conversion of specific fractions of biomass (C5 sugars/arabinose) to DSM's portfolio, allowing DSM to further optimize its yeast technology.

Rob van Leen, Chief Innovation Officer at DSM said: "This acquisition represents a key strategic step as we further strengthen our existing yeast platform and portfolio of bio-conversion technologies for second generation biofuels and biomaterials. We further increase our leadership position in the field of fermentation technology for mixed sugars derived from agricultural residues and non-edible crops. With our bright science and strong technology position we are bringing second generation biofuels closer to mass-scale production, reducing society's dependence on fossil feed stocks and avoiding the food versus fuel dilemma."

In the United States alone there is an expected market size of more than USD 1 billion in 2020 for enzymes and yeast for second generation biofuels. DSM is currently working with many companies in the development of second generation biofuels and is overall on-track to support several commercial demonstration facilities timed to start up in 2014.

Conference call

Today DSM will hold a conference call for investors and analysts from 09.00-09.30 CET which can be accessed by dialing +31 10 29 44 271 or +44 203 365 3207. A replay can be accessed as of approximately 10.30 CET by dialing +31 10 29 44 210 with access code 1193286#.

DSM - Bright Science. Brighter Living.™

Royal DSM N.V. is a global science-based company active in health, nutrition and materials. By connecting its unique competences in Life Sciences and Materials Sciences DSM is driving economic prosperity, environmental progress and social advances to create sustainable value for all stakeholders. DSM delivers innovative solutions that nourish, protect and improve performance in global markets such as food and dietary supplements, personal care, feed, pharmaceuticals, medical devices, automotive, paints, electrical and electronics, life protection, alternative energy and bio-based materials. DSM's 22,000 employees deliver annual net sales of about EUR 9 billion. The company is listed on NYSE Euronext. More information can be found at www.dsm.com

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