Corn Products Acquires Akzo Nobel's National Starch

Corn Products International (CPO) announced Monday it has agreed to acquire National Starch from Akzo Nobel (AKZOY) of the Netherlands for $1.3 billion.

Corn Products of Westchester, Ill. provides corn-based goods for diversified industries. The acquisition of National Starch of Bridgewater, N.J., which produces specialty starches focused particularly on the food industry, will expands Corn Product's product portfolio and its global market base.

Further, the acquisition will increase sales by $5 billion, and the company expects significant production efficiencies and cost synergies of at least $50 million. On a cash basis, the transaction is expected to be accretive by the end of 2011.

"The acquisition aligns with our strategic priorities to grow our ingredient portfolio, increase our presence in priority food processing segments, enter new markets, and develop innovative solutions that better serve our customers," Ilene Gordon, chairman, president and CEO of Corn Products said in a statement.

National Starch's development of specialty and modified starches is important to Corn Product's ongoing growth, the company said. National Starch's ingredient solutions, such as texturants, blends and environmentally "green" solutions, will broaden Corn Products' offerings to its global customers.

National Starch has 2,250 employees around the world and operates 11 plants in eight countries.

The acquisition has been approved by both companies' boards and is expected to close in the third quarter of 2010, subject to customary regulatory approvals.

Akzo Nobel CEO Hans Wijers said the deal would strengthen the company's balance sheet and leave it "well positioned to capture growth both organically and by selected acquisitions," according to the Associated Press.

Akzo Nobel shares rose 2.4% in Amsterdam trading.