Homeologous recombination (recombination between partially homeologous DNA sequences) was used to produce novel functional deacetoxycephalosporin C synthase (expandase) enzymes in vivo which are hybrids of the Streptomyces clavuligerus and Nocardia lactamdurans enzymes. DNA sequencing of hybrids obtained in E. coli showed that recombination had occurred at several locations within conserved sequences as short as 2 bp. Recombination events obtained in a Streptomyces background resulted in expandases with altered activity on penicillin G as determined by bioassay and HPLC.