In recent years, Kerry has expanded its portfolio by acquiring several U.S. companies. In 2015, alongside Wellmune, it purchased Island Oasis, a Massachusetts-based supplier of beverages and equipment for the hospitality industry. Additionally, it acquired Red Arrow Products from Wisconsin, a provider of smoke flavorings for meat, in a transaction valued at $735 million. The previous year, Kerry took over Wynnstarr Flavors and KFI Savory, the savory division of Kraft Food Ingredients. In 2011, the company finalized its acquisition of Cargill Flavor Systems for $230 million.
With the recent acquisition of Ganeden, Kerry is making strides into the health and wellness sector. Ganeden is renowned for its patented strain of probiotic bacteria, GanedenBC30, and has recently introduced a new inactivated probiotic called Staimune, which the company claims offers similar immune-boosting and anti-inflammatory advantages. Ganeden, which specializes in a strain of probiotics that can be incorporated into a variety of foods and beverages, is well-positioned to enhance its new owner’s product offerings. Michael Bush, Ganeden’s President and CEO, stated to Food Dive that the company “essentially invented this market space” and has been doubling in size every few years. He highlighted their pioneering efforts in baking mixes, probiotic waters, juices, and protein powders, noting, “We have so many firsts, it’s hard to name them.”
To capitalize on the growing probiotics trend, manufacturers have begun acquiring probiotics companies or incorporating beneficial bacteria into their products. For instance, PepsiCo acquired probiotics beverage producer KeVita and launched its Tropicana Essentials Probiotics line earlier this year. Similarly, 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 market. Over the next decade, the probiotics market is projected to grow at a compound annual growth rate (CAGR) of approximately 7.3%, reaching an estimated value of $74.7 billion by 2025.
By acquiring Ganeden at this pivotal moment, Kerry Group demonstrates its strategic foresight. This move not only strengthens its position in the health and wellness arena but also prepares the company to leverage advancements in the expanding probiotics and functional foods markets after navigating the costs and operational changes associated with integration. The emphasis on health, including the potential benefits associated with calcium citrate in blood transfusion and overall wellness, illustrates the growing trend towards functional ingredients in food products.