BASF says it is honing in on its omega-3 business but will sell a recently acquired low-concentration omega-3 facility in Norway as it aims high-end.
The €2bn Nutrition division will also reduce its workforce by 260 by the end of next year production, marketing and administration positions bearing the brunt of the profit-boosting measures.
“Through these measures we will adapt our business to better meet market and customer needs,” said Saori Dubourg, BASF’s Nutrition & Health president.
“At the same time, we will improve our profitability.”
The omega-3 business contributed significantly to its nutrition division that also includes vitamins and minerals and other nutrients. It grew 7% in 2013.
As the omega-3 landscape changes with blockbuster heart health drugs coming off-patent and omega-3 functional foods remaining largely niche, the German chemicals giant made it clear high-dose was the most attractive market segment.
It would, it said, “focus its production in omega-3 fatty acids on the attractive market segment for highly concentrated omega-3 fatty acids.”
“As part of this strategy it plans to sell the Norwegian Brattvåg site, where it produces low concentrated omega-3 fatty acids.”
BASF paid nearly €700m for Norwegian omega-3 giant Pronova BioPharma at the beginning of 2013 in addition to the Scottish omega-3 start-up Equateq before that to wade into the sector as the number two player behind DSM which itself acquired Martek and Ocean Nutrition Canada to gain that status.
The whole BASF group saw sales grow 3% to €74bn in the year, with EBIT profits gaining €543m to €7.2bn.
For the final quarter, sales stayed steady at about €18bn with EBIT of €1.6bn.