CSM has agreed to sell its bakery supplies division to Rhone Capital for €1.05bn, the company said on Monday. The net proceeds will be €850m, which is less than analysts had expected.

The divestment is central to CSM’s strategy to reform itself into a bio-plastics and ingredients group and was first announced last May.

When the sale has been completed, the company will consist of Purac and the US division Caravan Ingredients, which are both active in biotechnology. The company hopes the sale of the bakery unit will allow for investment in biotech, reduce debts and benefit shareholders.