Chr. Hansen – Long-term financing for value creation

The global bioscience corporation Chr. Hansen partners with customers and researchers to deliver unique microbial solutions for a wide range of industries. A long-term partnership with NIB has supported the company in financing its large-scale innovation programmes.

Chr. Hansen is a global supplier of speciality ingredients, such as food cultures, enzymes and natural ingredients solutions for the food, pharmaceutical and agricultural industries.

Since its foundation in 1874 by Danish pharmacist Christian Hansen, who developed the first industrialized enzymes and dairy cultures used in cheese production, Chr. Hansen has relied on bioscience research to maintain its position as one of the technology leaders in the field.

Since the demand for cleaner products free from preservatives is continuously growing stronger, so is the call for new product development. Søren Westh Lonning, CFO of Chr. Hansen, weighs in on the importance of R&D and long-term financing for value creation.

“The majority of our product innovation comes from our strong bioscience technology platforms”, Mr. Westh Lonning explains. “We regularly meet with customers and experts to understand the changes in the market, and gear our activities towards clients’ need for improved processes and customer demand for healthier food products.”

“We actively partner with researchers, universities and biotech companies to respond to these demands,” he says. “Partnerships can start at any stage of a project, from joint research in early phases to in-licencing of fully developed products.”

In the coming years, Chr. Hansen plans to invest up to 7% of its sales revenue in R&D. The main R&D activities are carried out in Denmark. Production sites are located in Denmark, Germany, France and the United States.

Since 2013, Chr. Hansen and NIB have signed three loans for financing the company’s R&D programmes; the most recent one was agreed in 2017.

“Research and development are critical components of our value creation. The right long-term financing has allowed us to take the right business decisions, which ultimately drive the success of our company”, Mr. Westh Lonning says.

“We started very constructive cooperation with NIB, and we have continued to expand our business relations during a period where Chr. Hansen has substantially increased its R&D spending. We highly appreciate the cooperation and look forward to continuing it.”

In addition to the financing from NIB, Chr. Hansen is also receiving governmental funding from Denmark and EU funding for parts of its research programmes.

“For the future, we are looking into bioprotection, which means using natural good bacteria as preservatives for prolonging shelf life and reducing food waste”, Mr. Westh Lonning says. “There are economic incentives for all parts of the value chain, including producers, retailers and consumers.”