Symrise may make more acquisitions six months down the line
Symrise, the listed German maker of scents and flavorings, may make more acquisitions six months down the line, according to an interview published in Boersen-Zeitung.
As part of a wider conversation with the German-language daily, finance chief Bernd Hirsch said Symrise may seek new acquisitions once it has spent a half-year focusing on integrating its recent EUR 1.3bn buy, the Diana group.
Asked whether the financing for the Diana deal takes Symrise's leverage outside the target range of 2.0 to 2.5 times EBITDA, Hirsch confirmed that the ratio will rise to about 3.0. He added that this is not a bad figure. Symrise's leverage is likely to be back in the 2.0-2.5 range by 2015, he predicted.
Hirsch did not rule out the possibility of seeking a credit rating, saying this may be pursued should Symrise become a more frequent user of the bond market as a financing source. He mentioned further acquisitions as a possible reason why such a change may take place.
Hirsch said Symrise expects synergies from its purchase of Diana to be worth about EUR 20m, or 5% of Diana's turnover. He said that to a substantial extent, these synergies will be in production costs, thanks to using the raw materials of Diana. He added that the synergies will not be fully realized until 2018.
Hirsch said the integration of Diana is likely to cost EUR 15m-EUR 20m, with the costs likely to be incurred during 2014, though the integration may still be under way in the beginning of next year.
Symrise would be financially ready to conduct another takeover by the beginning of 2015, Hirsch told the newspaper.
Hirsch rejected the idea that Symrise might become a takeover target for the Japanese seasonings maker Ajinomoto. He also said that Symrise, which has a EUR 5.2bn market capitalization, would cost at least EUR 8bn.
Source Boersen-Zeitung