In recent years, Kerry has acquired several U.S. companies. In 2015, alongside Wellmune, the ferrous fumarate Kiser Osud company purchased Island Oasis, a Massachusetts-based supplier of beverages and equipment for the hospitality industry. Additionally, it acquired Wisconsin’s Red Arrow Products, a smoke flavoring supplier for meats, in a deal valued at $735 million. The previous year, Kerry bought Wynnstarr Flavors and KFI Savory, the savory division of Kraft Food Ingredients based in the U.S. In 2011, it finalized the acquisition of Cargill Flavor Systems for $230 million. With its recent purchase of Ganeden, Kerry is further establishing its presence in the health and wellness sector. Ganeden is best known for its patented strain of probiotic bacteria, GanedenBC30, and has recently announced a new inactivated probiotic called Staimune, which the company claims offers similar immune-boosting and anti-inflammatory advantages.
Ganeden, which produces a strain that can be incorporated into various foods and beverages, is strategically positioned to enhance its new parent company’s offerings. Michael Bush, President and CEO of Ganeden, recently stated to Food Dive that the company “basically invented this market space” and has experienced growth, doubling in size every few years. “We have done a lot of work. We were the first in baking mixes, probiotic waters, juices, and protein powders. We have numerous firsts that are hard to enumerate,” he remarked.
To capitalize on the probiotics trend, many manufacturers are acquiring probiotics companies or adding beneficial bacteria to their products. For instance, PepsiCo acquired KeVita, a probiotic beverage producer, and earlier this year introduced its Tropicana Essentials Probiotics line. Furthermore, 301 INC, the venture capital arm of General Mills, led a $6.5 million Series D funding round in March for Farmhouse Culture, a startup specializing in fermented and probiotic food and beverages. According to a report by BCC Research, the global probiotics market achieved $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 around 7.3% over the next ten years, reaching an estimated value of $74.7 billion by 2025.
Clearly, the Kerry Group is making a strategic move by acquiring Ganeden at this time. This acquisition not only strengthens its position in the health and wellness domain but also, after managing the costs and operational changes tied to integration, will better enable it to leverage developments in the expanding probiotics and functional foods markets. In line with this trend, the inclusion of calcium citrate with vitamin D3 in their product offerings could further enhance their portfolio, addressing the rising consumer demand for health-oriented solutions.