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DLF-Trifolium to acquire Cebeco Seeds

9.18am 30th October 2002 - Corporate

It has been announced in Rotterdam that DLF-Trifolium A/S, a company incorporated in Denmark, and Cebeco Groep BV, a company incorporated in the Netherlands, are in advanced negotiations on a possible take over of Cebeco Seeds Group by DLF-Trifolium. It is anticipated that the transaction will be finalised by year-end 2002. The new group will be a substantial force in the world market of cool season grass and clover seeds. Moreover, the new company will also have a strong position in the European cereals, pulses and flax market. The enlarged DLF-Group will employ approx. 860 people and will have a combined turnover of approx. 270 million Euro.

Once agreed, completion of the deal will be subject to internal and external approval procedures. Financial details of the take over will not be disclosed.

The take over of Cebeco Seeds Group by DLF-Trifolium is set to ensure the commercial basis and financial resources to enhance technologically advanced research and development programmes. This will provide the new group with the possibility to improve the quality and performance of varieties and services to the benefit of their customers.

Both Cebeco Seeds Group and DLF-Trifolium are well-regarded players in the international seed industry, possessing an extensive market and product knowledge. The two companies in the new group will continue to operate under their own separate trade names and images. The long term objective of the group is to expand its market position in the European and overseas markets and to improve profitability, based upon excellent seedsmanship, a strong product portfolio and highly qualified employees.

DLF-TRIFOLIUM A/S was founded in 1872 and is owned by Danish seed growers through the co-operative DLF AmbA. DLF-Trifolium A/S is a vertically integrated international seeds group, specialising in breeding, production, marketing and sales of seeds of grasses, pulses and fodder beet.

The group has activities world-wide and subsidiaries in the UK (DLF Perryfields Ltd), Germany, France, China, Czech Republic and the USA and is a partner in a number of complementary businesses linked to the seed industry. DLF is market leader in Europe in grass seeds. World-wide the group is highly ranked among those grass seed companies that are vertically integrating breeding, production and marketing/sales.

DLF-Trifolum A/S has an annual turnover (2002) of approx. 173 million Euro. The group employs approx. 510 people and produces and sells in total approx. 85,000 tons of grass and clover seeds. The company has a strong balance sheet with an equity ratio of 44%.

CEBECO GROEP BV was founded in 1899 and is currently the second largest agricultural co-operative in the Netherlands. The company is owned by 18 Dutch co-operatives, ultimately representing approx. 40,000 farmers and growers.

Cebeco Group aims at improving the competitive position of its members and the income of affiliated farmers and growers in the Netherlands.

The Group is currently in the process of aligning its portfolio within the main scope of the activities of its members. As a consequence, Cebeco Group will focus on meat and feed production and trading. In 2000, the consolidated revenues equalled 3.4 billion Euro.

CEBECO SEEDS GROUP B.V. is a vertically integrated international seeds Group within breeding, production, marketing and sales of grass seed as well as cereals, pulses and flax. Moreover, Cebeco Seeds Group screens and markets third party varieties of maize.

Cebeco’s seed activities were initiated in the 1930’s. The Group is based in Vlijmen in the Netherlands and operates 13 independent business units in nine countries. It has a significant market position with a top 3 position in winter wheat and pulses in the key European markets as well as a top 3 position in the grass seed market.

In 2001, the turnover of Cebeco Seeds Group was approx. 96 million Euro. The Group employs approx. 350 people.

“The international grass seed industry is fragmented and, as a result, it is difficult to achieve sufficient profitability in order to, among other things, invest in research and development,” said Mr Aksel Nissen, CEO of DLF-Trifolium. “The contemplated acquisition forms part of a well-defined strategy of DLF-Trifolium that aims at participating in a consolidation of the grass seed industry. By creating one new group with two separate marketing channels and at the same time utilising the synergetic effects, a strong Group with an excellent position for further growth and profitability in the future has been created. We are confident that the acquisition will lead to a return on investment satisfactory to the shareholders of DLF-Trifolium, who ultimately are Danish seed growers.”

“The new Group will have the financial and commercial capabilities, necessary to meet the ever increasing competition pressures within the seed business internationally,” said Mr Gert van Straalen, CEO of Cebeco Seeds Group. “Under DLF-Trifolium ownership, I personally believe that we will create a firm basis for further development of the Cebeco Seeds Group.”

DLF-Trifolium www.dlf.dk

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