Darling Ingredients Inc 8-K, filed May 12, 2025
Darling Ingredients Inc. (DAR)
About this 8-K
Darling Ingredients Inc filed this 8-K on May 12, 2025.
Items reported
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
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WASHINGTON, DC 20549
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CURRENT REPORT
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| Item 7.01. | Regulation FD Disclosure. |
On May 12, 2025, Darling Ingredients Inc. (the “Company”) announced that it signed a non-binding term sheet with Tessenderlo Group NV (“Tessenderlo”) (XBRU: TESB) to form a joint venture. The purpose of the joint venture is to combine the collagen and gelatin businesses of the Company, which businesses operate under the Rousselot brand, and Tessenderlo, which businesses operate under the PB Leiner brand. These businesses will be contributed to a new company called NextidaTM. The Company will hold an 85% ownership stake in the joint venture and Tessenderlo will hold the remaining 15% ownership stake. The term sheet covers customary items, including structure, governance, and management of the joint venture. The formation of the joint venture is subject to customary due diligence, negotiation of definitive transaction documents, satisfaction of customary closing conditions, and regulatory approvals. The transaction is anticipated to close in 2026. A copy of the press release announcing the proposed transaction is furnished as Exhibit 99.1.
The Company will hold a conference call and webcast for investors today, May 12, 2025 at 8 a.m., Central Time, to review the proposed transaction. The Company will have a slide presentation available to augment management’s formal presentation, which will be accessible via the investor relations section of the Company’s website. A copy of the slide presentation is furnished as Exhibit 99.2.
This Current Report and Exhibits 99.1 and 99.2 includes “forward-looking statements,” which may include information concerning the Company’s financial performance, plans, objectives, goals, strategies, future earnings, cash flow, performance and other information that is not historical information. When used in this Current Report and Exhibits 99.1 and 99.2, the words “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “will” and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements are based upon current expectations and beliefs and various assumptions. There can be no assurance that the Company will realize these expectations or that these beliefs will prove correct. There are a number of risks and uncertainties that could cause actual results to differ materially from the results expressed or implied by the forward-looking statements contained in this Current Report and Exhibits 99.1 and 99.2. Numerous factors, many of which are beyond the Company’s control, could cause actual results to differ materially from those expressed as forward-looking statements. These include factors which could preclude the Company from closing the proposed transaction or realizing the anticipated benefits of the proposed transaction. Other risk factors include those that are discussed in the Company’s filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made, and the Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances.
The information in this Current Report and Exhibits 99.1 and 99.2 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
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| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| 99.1 | Press Release dated May 12, 2025 regarding proposed transaction with Tessenderlo Group NV (furnished) | |
| 99.2 | Slide Presentation for Monday, May 12, 2025 conference call and webcast for investors (furnished) | |
| 104 | Cover Page Interactive Data File (embedded within Inline XBRL document) | |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| DARLING INGREDIENTS INC. | ||||||
| Date: May 12, 2025 | By: | /s/ John F. Sterling | ||||
| John F. Sterling | ||||||
| Executive Vice President, General Counsel | ||||||
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Exhibit 99.1
| FOR IMMEDIATE RELEASE May 12, 2025 |
|
Darling Ingredients and Tessenderlo Group Agree to Form New Company to Accelerate Growth in Attractive Collagen-Based Health, Wellness and Nutrition Sector
| • | Creates ~$1.5 billion revenue company in fast-growing collagen-based health, nutrition and food sectors |
| • | 85% owned and consolidated by Darling Ingredients |
| • | Non-cash transaction, combining assets, capabilities |
| • | Strengthens foundation around serving food and pharma customers |
| • | Provides a platform for accelerated product development and growth |
| • | Creates an opportunity to unlock significant shareholder value |
IRVING, Texas – Darling Ingredients Inc. (NYSE: DAR) today announced the signing of a non-binding term sheet with Tessenderlo Group (XBRU: TESB) to combine the collagen and gelatin segments of their companies into a new company called Nextida™, requiring no cash or initial investment from either party. This strategic partnership aims to create a top-tier, collagen-based health, wellness and nutrition products company positioned to capitalize on global collagen growth. The transaction is subject to negotiation and execution of definitive documentation by the parties.
Pending regulatory approvals, Nextida will operate as a joint venture, with Darling Ingredients holding a majority, 85% ownership stake and Tessenderlo Group holding the remaining 15%. Nextida will combine Darling Ingredients’ collagen and gelatin business, branded as Rousselot, with Tessenderlo Group’s PB Leiner business. The combination will result in a new company, initially with expected annual revenue of approximately $1.5 billion, and total gelatin and collagen capacity of about 200,000 metric tons across 23 facilities located in South America, North America, Europe and Asia. Over time, the integration of the two companies provides significant opportunities to realize synergies and develop the Nextida portfolio of products, delivering targeted health benefits and providing a significant opportunity to increase earnings.
“By working with Tessenderlo Group over the last several months, we have developed a great opportunity that will allow us to establish a new company that provides a strong platform for accelerated product development and growth,” said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients. “Collagen has represented the fastest-growing area of Darling Ingredients’ food segment business over the past several years, and with the addition of PB Leiner’s people, assets and products, we are well positioned to increase scale and focus in this rapidly growing segment.”
Luc Tack, Chief Executive Officer, Tessenderlo Group, added, “With this combination, we will have the best new ownership possible. We will benefit from each other by sharing technology expertise and providing a complementary offering for our global customer base. This includes many in-demand products, such as gelatin and collagen peptides.”
The integration of these businesses provides further infrastructure and geographical reach to meet the growing demand for collagen products, minimizing the need for additional infrastructure investment, while realizing significant synergies through commercial and logistical optimization and operational efficiencies.
Pending regulatory approvals, the transaction is expected to close in 2026.
This strategic partnership is expected to create new opportunities for growth, while expanding options to enhance shareholder value.
Darling Ingredients will host a conference call and webcast for investors at 9 a.m. Eastern Time (8 a.m. Central Time) today, May 12, 2025, to discuss this announcement. Prior to the call, a presentation will be available at darlingii.com/nextida.
To access the call as a listener, please register for the audio-only webcast.
To join the call as a participant to ask a question, please register in advance to receive a confirmation email with the dial-in number and PIN for immediate access on May 12 or call 833-470-1428 (United States) or 404-975-4839 (international) using access code 780865.
A replay of the call will be available online via the webcast registration link two hours after the call ends. A transcript will be posted at darlingii.com/nextida within 24 hours.
About Darling Ingredients
A pioneer in circularity, Darling Ingredients Inc. (NYSE: DAR) takes material from the animal agriculture and food industries, and transforms them into valuable ingredients that nourish people, feed animals and crops, and fuel the world with renewable energy. The company operates over 260 facilities in more than 15 countries and processes about 15% of the world’s animal agricultural by-products, produces about 30% of the world’s collagen (both gelatin and hydrolyzed collagen), and is one of the largest producers of renewable energy. To learn more, visit darlingii.com. Follow us on LinkedIn.
About Tessenderlo Group
Tessenderlo Group is an industrial group that focuses on agriculture, valorizing bio-residuals, machinery, mechanical engineering, electronics, energy, and providing industrial solutions with a focus on water. With its headquarters in Belgium, the group is active in over 100 countries and has a global team of more than 7,000 employees.
Cautionary Statements Regarding Forward-Looking Information:
This release may contain “forward-looking statements,” which include information concerning the Company’s financial performance, plans, objectives, goals, strategies, future earnings, cash flow, performance and other information that is not historical information. When used in this release, the words “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “will” and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements are based upon current expectations and beliefs and various assumptions. There can be no assurance that the Company will realize these expectations or that these beliefs will prove correct. There are a number of risks and uncertainties that could cause actual results to differ materially from the results expressed or implied by the forward-looking statements contained in this release. Numerous factors, many of which are beyond the Company’s control, could cause actual results to differ materially from those expressed as forward-looking statements. These include factors which could preclude the Company from closing the proposed transaction or realizing the anticipated benefits of the proposed transaction. Other risk factors include those that are discussed in the Company’s filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made, and the Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances.
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Darling Ingredients Contacts
| Media: | Jillian Fleming | |
| Director, Global Communications | ||
| (972) 541-7115; jillian.fleming@darlingii.com | ||
| Investors: | Suann Guthrie | |
| Senior VP, Investor Relations, Sustainability & Communications | ||
| (469) 214-8202; suann.guthrie@darlingii.com | ||
Exhibit 99.2 Nextida: Accelerating growth in health, wellness, nutrition products sector May 12, 2025
This presentation includes “forward-looking” statements that are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the statements. Statements that are not statements of historical facts are forward-looking statements and are made pursuant to the safe harbor provisions of the Private SecuritiesLitigation Reform Act of 1995. Words such as “estimate,” “guidance,” “outlook,” “project,” “planned,” “contemplate,” “potential,” “possible,” “proposed,” “intend,” “believe,” “anticipate,” “expect,” “may,” “will,” “would,” “should,” “could,” and similar expressions are intended to identify forward-looking statements. All statements other than statements of historical facts included in this presentation are forward-looking statements. Forward-looking statements are based on the Company's current expectations and assumptions regarding its business, the economy and other future conditions. The Company cautions readers that any such forward-looking statements it makes are not guarantees of future performance and that actual results may differ materially from anticipated results or expectations expressed in its forward-looking statements as a result of a variety of factors, including many that are beyond the Company's control. Important factors that could cause actual results to differ materially from the Company’s expectations include: factors which could preclude the Company from closing the proposed transaction or realizing the anticipated benefits of the proposed transaction; existing and unknown future limitations on the ability of the Company's direct and indirect subsidiaries to make their cash flow available to the Company for payments on the Company's indebtedness or other purposes; reduced demands or prices for biofuels, biogases or renewable electricity; global demands for grain and oilseed commodities, which have exhibited volatility, and can impact the cost of feed for cattle, hogs and poultry, thus affecting available rendering feedstock and selling prices for the Company’s products; reductions in raw material volumes available to the Company due to weak margins in the meat production industry as a result of higher feed costs, reduced consumer demand, reduced volume due to government regulations affecting animal production or other factors, reduced volume from food service establishments, or otherwise; reduced demand for animal feed; reduced finished product prices, including a decline in fat, used cooking oil, protein or collagen (including, without limitation, collagen peptides and gelatin) finished product prices; changes to government policies around the world relating to renewable fuels and greenhouse gas (“GHG”) emissions that adversely affect prices, margins or markets (including for the DGD Joint Venture), including programs like renewable fuel standards, low carbon fuel standards (“LCFS”), renewable fuel mandates and tax credits for biofuels, or loss or diminishment of tax credits due to failure to satisfy any eligibility requirements, including, without limitation, in relation to the blender tax credit or the Clean Fuels Production Credit (“CFPC”); climate related adverse results, including with respect to the Company’s climate goals, targets or commitments;possible product recall resulting from developments relating to the discovery of unauthorized adulterations to food or food additives or products which do not meet specifications, contract requirements or regulatory standards; the occurrence of 2009 H1N1 flu (initially known as “Swine Flu”), highly pathogenic strains of avian influenza (collectively known as “Bird Flu”), severe acute respiratory syndrome (“SARS”), bovine spongiform encephalopathy (or “BSE”), porcine epidemic diarrhea (“PED”) or other diseases associated with animal origin in the U.S. or elsewhere, such as the outbreak of African Swine Fever in China and elsewhere; the occurrence of pandemics, epidemics or disease outbreaks, such as theCOVID-19 outbreak; unanticipated costs and/or reductions in raw material volumes related to the Company’s compliance with the existing or unforeseen new U.S. or foreign (including, without limitation, China) regulations (including new or modified animal feed, Bird Flu, SARS, PED, BSE or ASF or similar or unanticipated regulations) affecting the industries in which the Company operates or its value added products; risks associated with the DGD Joint Venture,including possible unanticipated operating disruptions, a decline in margins on the products produced by the DGD Joint Venture and issues relating to the announced SAF upgrade project (including, without limitation, operational, mechanical, product quality, market based or other such issues); risks and uncertainties relating to international sales and operations, including imposition of tariffs, quotas, trade barriers and other trade protections by foreign countries; tax changes, such as global minimum tax measures, or issues related to administration, guidance and/or regulations associated with biofuel policies, including CFPC, and risks associated with the qualification and sale of such credits; difficulties or a significant disruption (including, without limitation, due to cyber-attack) in the Company’s information systems, networks or the confidentiality, availability or integrity of our data or failure to implement new systems and software successfully; risks relating to possible third-party claims of intellectual property infringement; increased contributions to the Company’s pension and benefit plans, including multiemployer and employer-sponsored defined benefit pension plans as required by legislation, regulation or other applicable U.S. or foreign law or resulting from a U.S. mass withdrawal event; bad debt write-offs; loss of or failure to obtain necessary permits and registrations; continued or escalated conflict in the Middle East, North Korea, Ukraine or elsewhere, including the Russia-Ukraine war and the Israeli-Palestinian conflict and other associated or emerging conflicts in the Middle East; uncertainty regarding the exit of the U.K. from the European Union; uncertainty regarding any administration changes in the U.S. or elsewhere around the world, including, without limitation, impacts to trade, tariffs and/or policies impacting the Company (such as biofuel policies and mandates); and/or unfavorable export or import markets. These factors, coupled with volatile prices for natural gas and diesel fuel, inflation rates, climate conditions, currency exchange fluctuations, general performanceof the U.S. and global economies, disturbances in world financial, credit, commodities and stock markets, and any decline in consumer confidence and discretionary spending, including the inability of consumers and companies to obtain credit due to lack of liquidity in the financial markets, among others, could cause actual results to vary materially from the forward-looking statements included in this report or negatively impact the Company’s results of operations.Among other things, future profitability may be affected by the Company’s ability to grow its business, which faces competition from companies that may have substantially greater resources than the Company. The Company’s announced share repurchase program may be suspended or discontinued at any time and purchases of shares under the program are subject to market conditions and other factors, which are likely to change from time to time. For more detailed discussion of these factors and other risks and uncertainties regarding the Company, its business and the industries in which it operates, see the Company’s filings with the SEC, including the Risk Factors discussion in Item 1Aof Part I of the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2023. The Company cautions readers that all forward-looking statements speak only as of the date made, and the Company undertakes no obligation to update any forward-looking statements, whether as a result of changes in circumstances, new events or otherwise. 2
Darling Ingredients and Tessenderlo Group have signed a non- binding term sheet to create Nextida, a ~$1.5B revenue joint venture to support the fast-growing collagen-based health, nutrition and wellness segment 85% owned and consolidated by Darling Ingredients Non-cash transaction, combining assets, capabilities Executive Poised to realize significant value through commercial delivery and Summary logistical optimization, as well as operational efficiencies, leveraging increased scale and diversification Creates an opportunity to unlock significant shareholder value Provides platform for accelerated product development and growth 3
Poised to compete in the broader health, wellness and nutrition products sector Top-tier, collagen-based health, wellness and nutrition products company 85% 15% Diversified global Gelatin solutions Global player in Producer in portfolio in attractive for the pharma rapidly growing established regions industry collagen sector gelatin & hydrocolloid segment Deep scientific expertise pioneering Wide range of quality Strong and reliable advanced collagen-based solutions gelatins and collagen access to raw for targeted health benefits peptides materials 4
Highly compelling strategic and financial benefits Provides expanded infrastructure to Expanded opportunities within total Broader geographical reach to scale support growth in high-value product addressable health and nutrition rapidly in fast growing regions in Europe, offerings, including collagen peptides and South America, Asia supplement market of ~$80B activated collagen peptides Strategic Benefits Enhanced access to raw materials Further diversifies product mix Limited customer overlap with closer proximity to animal sources Creates new opportunities for Margin accretive through growth, with expanded revenue Strong growth trajectory access to new markets and product development opportunities base of ~$1.5B Financial Benefits Significant value creation through Ability to optimize assets to serve Creates an opportunity to unlock enhanced access to raw materials, customer needs and lower logistical significant shareholder value commercial and logistical opportunities and operational cost and optimized future investments 5
Growing global demand for health, Targeted wellness markets wellness, nutrition supplements Wellness Sales of dietary supplements in world $15.2B Retail Value RSP – USD million – Current – 2009-2028 Immunity Digestive Bone $81,348 $9.5B $9.1B $7.7B 120,000 Forecast +5.5% CAGR Heart Joint Energy 100,000 $5.4B $4.6B $4.1B 80,000 Brain Women’s health Eye 60,000 $2.6B $2.6B $2.5B 40,000 Mood 20,000 $1.6B 0 2009 2023 2028 6 Source: PwC, Euromonitor
Building on an Top-tier collagen-based health, wellness innovative and nutrition products company health, nutrition First collagen and wellness solution Innovative Future platform Launched in Q4 2024 platform of collagen collagen peptide Targets post-meal peptide compositions product glucose spikes Provides platform for for natural, targeted opportunities health benefits Triggers the natural accelerated product release of GLP-1 development and growth 7
Well positioned for accelerated growth and new product development Combined capabilities Rousselot production locations PB Leiner production locations • ~200,000 metric tons extraction capacity • ~70,000 metric tons hydrolyzed collagen capacity • Full complement of raw material collagen options ü Bovine ü Porcine ü Fish ü Bone • Ability to serve customers anywhere in the world from raw materials & production across four continents • Scaled platform for continued development of Nextida portfolio of products
Key transaction terms Financial structure Closing Finalizing agreement terms, with transaction Darling Ingredients will hold a majority 85% ownership expected to close in 2026 stake and Tessenderlo Group the remaining 15% Non-cash transaction, combining assets and The term sheet has been unanimously approved capabilities by the board of directors of both companies Consolidated on the Darling Ingredients Subject to regulatory approvals and other financial statements customary closing considerations 9
Driving significant long-term value creation New opportunities for Maximizing Margin accretive accelerated shareholder through access to new geographies / growth value opportunities 10