In recent years, Kerry has acquired several U.S. companies to expand its portfolio. In 2015, together with Wellmune, the firm purchased Island Oasis, a Massachusetts-based supplier of beverages and equipment for the hospitality industry. Additionally, it acquired Red Arrow Products from Wisconsin, a smoke flavoring supplier for meat products, in a transaction valued at $735 million. In 2014, Kerry took over Wynnstarr Flavors and KFI Savory, the savory division of Kraft Food Ingredients in the U.S. Earlier, in 2011, it finalized the acquisition of Cargill Flavor Systems for $230 million.
With the acquisition of Ganeden, Kerry is increasingly focusing on the health and wellness sector. Ganeden is renowned for its patented strain of probiotic bacteria known as GanedenBC30 and has recently introduced a new inactivated probiotic called Staimune, which the company claims offers similar immune-boosting and anti-inflammatory properties. The probiotics firm, which produces strains suitable for various food and beverage applications, stands to provide significant value to its new parent company. Michael Bush, President and CEO of Ganeden, recently shared with Food Dive that the company “essentially invented this market space” and has been doubling in size every few years. “We were the first in baking mixes, probiotic waters, juices, and protein powders. We have so many firsts, it’s hard to count them,” he stated.
To capitalize on the growing demand for probiotics, manufacturers are increasingly acquiring probiotic companies or incorporating these beneficial bacteria into their products. For instance, PepsiCo acquired KeVita, a probiotic beverage maker, and earlier this year launched its Tropicana Probiotics line. Meanwhile, 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 specializing in 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, expected to reach around $74.7 billion by 2025.
Kerry Group is strategically positioning itself by acquiring Ganeden at this pivotal moment. This move not only strengthens its presence in the health and wellness arena but, after navigating the integration costs and operational adjustments, will better equip the company to leverage opportunities in the rapidly expanding probiotics and functional foods markets. Furthermore, with the rising demand for products infused with beneficial ingredients like citrate de calcium and vitamin D3, Kerry is well-positioned to meet consumer needs in this evolving landscape. As the market continues to grow, the incorporation of citrate de calcium and vitamin D3 into various offerings will likely enhance product appeal and health benefits, solidifying Kerry’s competitive edge in the industry.