Entering emerging markets

Entering emerging markets Marc den Hartog, CSM, Jan 2013

Introducing CSM

• annual sales € 3.3 billion • workforce of around10.000 employees • operating in 28 countries worldwide • 45 manufacturing sites

1919

 Founded through a merger of 3 Dutch sugar manufacturers

Today

 the world’s largest supplier of bakery products & ingredients

 a leading player in natural food preservation, extended shelf life and bio-based chemicals

Approach to international expansion  Assessments of market attractiveness  Adjacency to the core  Operating risk  Importance of local manufacturing  Operating models  Local distribution partners, in combination with rep. office  Joint Ventures  Own company (acquisitions, greenfield)

Leveraging core strengths

 Remarkable products with well-known (B2B) brands  Category leadership

 Global key account relationships

Food going global

Starbucks India

The market opportunity of North Africa

TUNISIA

10,6 M MOROCCO

32,1 M

ALGERIA

36,3 M

LIBYA

6,6 M

MAURITANIA

3,4 M 90 M TOTAL POPULATION 26,7 Y

AVERAGE AGE

607 B $

TOTAL GDP

The market opportunity of North Africa  Search for strong local partner, found in Tunesia in 2011:

 leading position in Bakery Ingredients and Fats in North Africa  Part of SLAMA group (founded 1950)  Aligned objectives  Similar business culture

 Partnership & shared passion to build the business together  Both partners complementary contributions to J/V  CSM World class manufacturing, global innovation & marketing know-how  GIAS Local brands, established business infrastructure & distribution

Purac Thailand Ltd.

Purac Thailand product portfolio  Basic Lactic Acid

 Base material for other PURAC Factories globally  Direct supplies to the market in different grades  Lactates

 mainly used as food preservative and cosmetic applications  Buffered Lactic Acid  mainly used as buffering agent for a/o confectionery

Investing for renewable Bio plastics



2011 Investment of €45 million for production of lactide monomer



Lactide forms the basis to produce Bioplastics (PLA)



PLA reduce CO2 emissions with 70% vs mineral oil based plastics



Feedstock consists of local©agricultural products 1/31/2013

Checklist

 Deep understanding of local market  Contribution to the core  Organizational fit  Role of a local partner  Long term view

Thank you