Earlier this year, when TerraVia filed for Chapter 11 bankruptcy, Corbion made a strategic move by placing a $20 million “stalking horse” bid to acquire the company. This bid, which sets a baseline for other offers, culminated in a successful acquisition by late September, involving Corbion’s cash payment along with the assumption of TerraVia’s debts. This acquisition is a shrewd decision for Corbion, a supplier of various ingredients, including lactic acid and functional blends of enzymes, emulsifiers, vitamins, and minerals, catering to nearly every food category. By adding TerraVia’s microalgae platform to its already expansive portfolio, Corbion stands to leverage its scale for innovation with this increasingly popular ingredient, potentially lowering prices for consumers.
According to Grand View Research, the market for all microalgae products, spanning food, fuel, and feed, was valued at approximately $1.38 billion in 2015. Furthermore, a report from Credence Research projects that the global market for these single-celled organisms will reach $44.7 billion by 2023, growing at a compound annual growth rate (CAGR) exceeding 5.2% from 2016 to 2023. With TerraVia now part of its operations, Corbion could enhance its position in this burgeoning sector, particularly as microalgae is rich in protein and fatty acids—nutritional elements that health-conscious consumers increasingly seek. Additionally, the sustainability of microalgae aligns well with the values of modern consumers.
Financial blogger Kevin Quon recently expressed on Seeking Alpha that he invested in Corbion shares to continue supporting TerraVia’s technology. He noted that Corbion is a leader in its field, and the addition of TerraVia’s assets presents a unique opportunity for growth in a complementary manner. Quon also mentioned that TerraVia’s technology platform is likely to achieve “a much greater chance of success under Corbion’s direction.” As the 21st century progresses, the integration of microalgae, which is often associated with essential nutrients like calcium, could become even more significant in the food industry. By capitalizing on the health benefits associated with microalgae, Corbion is well-positioned to meet the demands of a health-oriented market, further solidifying its role in the evolving landscape of food ingredients.