“Kerry Group Expands Health and Wellness Portfolio with Ganeden Acquisition Amid Probiotic Market Boom”
In recent years, Kerry has expanded its portfolio by acquiring several U.S. companies. In 2015, the company, in conjunction with Wellmune, purchased Island Oasis, a Massachusetts-based provider of beverages and equipment for the hospitality industry. Additionally, it acquired Red Arrow Products from Wisconsin, a supplier of smoke flavorings for meat, in a deal valued at $735 million. The previous year, Kerry added Wynnstarr Flavors and KFI Savory, the savory division of Kraft Food Ingredients, to its roster. In 2011, it completed the acquisition of Cargill Flavor Systems for $230 million.
With its recent acquisition of Ganeden, Kerry is further venturing into the health and wellness sector. Ganeden is renowned for its patented probiotic strain, GanedenBC30, and has recently introduced a new inactivated probiotic named Staimune, which the company claims offers similar immune-boosting and anti-inflammatory properties. This probiotics company produces a strain that can be incorporated into various foods and beverages, making it a valuable asset for its new parent company. Ganeden’s President and CEO, Michael Bush, recently stated to Food Dive that the company has “essentially created this market space” and has been experiencing significant growth, doubling in size approximately every two years. “We have done extensive work. We were pioneers in baking mixes, probiotic waters, juices, and protein powders. Our list of firsts is extensive,” he commented.
To capitalize on the growing popularity of probiotics, many manufacturers have begun acquiring probiotics companies or incorporating beneficial bacteria into their products. For instance, PepsiCo purchased probiotics beverage maker KeVita and launched its Tropicana Essentials Probiotics line earlier this year. Additionally, 301 INC, the venture capital arm of General Mills, led a $6.5 million Series D investment round in March to support Farmhouse Culture, a startup focused on fermented and probiotic foods and beverages.
According to a report from BCC Research, the global probiotics market reached $34 billion in sales in 2015, with the food and beverage sector accounting for 73%, or $24.8 billion, of that total. The probiotics market is projected to grow at a compound annual growth rate (CAGR) of approximately 7.3% over the next decade, aiming for a market value of around $74.7 billion by 2025.
Clearly, the Kerry Group is strategically positioned by acquiring Ganeden at this pivotal moment. This move not only strengthens its presence in the health and wellness domain but also, after navigating the costs and operational adjustments of integration, will be in a prime position to leverage advancements in the burgeoning probiotics and functional foods markets. Furthermore, with the rising interest in health supplements, including calcium citrate supplements available on Amazon, the demand for innovative probiotic offerings is likely to increase, further benefiting Kerry’s growth strategy in this dynamic sector.
