(Yicai Global) June 19 -- Shares of Layn Natural Ingredients surged by the exchange-imposed daily trading limit after the Chinese maker of sweeteners said it had renewed its exclusive distribution agreement with European food flavors and fragrances giant DSM-Firmenich.

Layn [SHE: 002166] closed up 10 percent at CNY8 (USD1.12) a share in Shenzhen today, though the stock is still down 16 percent since the end of last year.

Layn will supply DSM-Firmenich with sweeteners for five years from next year, the Guilin-based firm said today. Averaging USD136 million to USD168 million a year, the deal will bring Layn revenue of between USD680 million and USD840 million including taxes, equal to about 69 percent to 85 percent of the company’s revenue last year, it added.

The two companies will also set up a joint technical team to offer targeted solutions and more innovative and convenient services to Chinese clients, it noted. In addition, they will leverage their advantages in the process of developing production technology in flavors and fragrances, animal nutrition, pharmaceuticals, and beauty products to improve service quality.

Layn and Firmenich signed a five-year natural sweetener distribution contract in September 2018 worth between USD345 million and USD400 million, the parties said then. Layn’s revenue from the deal reached CNY604 million (USD84.5 million) last year, accounting for 43 percent of its total. In 2020, the figures were CNY236 million and 30 percent.

Firmenich merged with DSM last month.

Editor: Futura Costaglione