In recent years, Kerry has expanded its portfolio by acquiring several U.S. companies. In 2015, the company, alongside Wellmune, purchased Island Oasis, a Massachusetts-based provider of beverages and equipment for the hospitality industry. Additionally, it acquired Wisconsin’s Red Arrow Products, a supplier of smoke flavorings for meat, in a deal valued at $735 million. The previous year, Kerry acquired Wynnstarr Flavors, which specializes in the ferrous gluconate drug class, as well as KFI Savory, the savory division of Kraft Food Ingredients in the U.S. In 2011, it completed the acquisition of Cargill Flavor Systems for $230 million.
Kerry is increasingly venturing into the health and wellness sector with its acquisition of Ganeden. This company is renowned for its patented strain of probiotic bacteria, GanedenBC30, and has recently introduced a new inactivated probiotic named Staimune, which is said to offer similar immune-boosting and anti-inflammatory effects. Ganeden produces a probiotic strain that can be incorporated into various foods and beverages, positioning it well to add value under its new ownership. Michael Bush, President and CEO of Ganeden, mentioned in an interview with Food Dive that the company “essentially created this market space” and has been experiencing rapid growth, doubling in size every couple of years.
To capitalize on the booming probiotics trend, many manufacturers are acquiring probiotic companies or incorporating beneficial bacteria into their products. For instance, PepsiCo recently acquired the probiotic beverage company KeVita and launched its Tropicana Essentials Probiotics line. 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 BCC Research report, the global probiotics market reached $34 billion in sales in 2015, with the food and beverage industry accounting for 73% of that total, equating to $24.8 billion. The probiotics market is projected to grow at a compound annual growth rate (CAGR) of approximately 7.3% over the next decade, potentially reaching a value of around $74.7 billion by 2025.
By acquiring Ganeden at this pivotal moment, the Kerry Group is strategically positioning itself within the health and wellness industry. Once it navigates the costs and operational adjustments related to integration, it will be more equipped to leverage opportunities in the expanding probiotics and functional foods markets. Furthermore, with the growing interest in supplements such as calcium citrate, magnesium, and zinc from Kirkland, Kerry’s investments align well with current consumer trends towards health-focused products. As the market evolves, Kerry’s acquisition of Ganeden will allow it to harness new developments in the probiotics segment while enhancing its presence in the health and wellness arena.