In recent years, Kerry has expanded its portfolio by acquiring several U.S. companies. In 2015, alongside Wellmune, the firm purchased Island Oasis, a Massachusetts-based provider of beverages and equipment for the hospitality industry. Additionally, it acquired Red Arrow Products, a Wisconsin-based supplier of smoke flavorings for meat, in a transaction valued at $735 million. The previous year, Kerry added Wynnstarr Flavors and KFI Savory, the savory division of Kraft Food Ingredients, to its holdings. Back in 2011, the company completed the acquisition of Cargill Flavor Systems for $230 million.
With its recent 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 it 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 a strain suitable for incorporation into various foods and beverages, stands to provide significant value to its new parent company. Ganeden’s President and CEO Michael Bush recently shared with Food Dive that the company “basically invented this market space” and has been experiencing consistent growth, doubling in size every few years. He highlighted their pioneering efforts in creating probiotic baking mixes, waters, juices, and protein powders, stating, “We have so many firsts, it’s hard to name them.”
In response to the growing demand for probiotics, many manufacturers have begun acquiring probiotics companies or incorporating beneficial bacteria into their products. For instance, PepsiCo acquired the probiotic beverage maker KeVita and launched its Tropicana Essentials Probiotics line earlier this year. Meanwhile, 301 INC, the venture capital arm of General Mills, led a $6.5 million Series D funding 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%, or $24.8 billion, of that total. The 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.
The Kerry Group’s strategic acquisition of Ganeden places it in a strong position within the health and wellness arena. This move not only enhances its presence in the market but also allows Kerry to leverage its resources effectively after navigating the costs and operational adjustments associated with integration. As the probiotics and functional foods markets continue to expand, Kerry will be well-prepared to capitalize on emerging opportunities, just as brands like Webber Naturals have effectively integrated products like calcium citrate into their offerings to meet consumer demand for health-focused solutions.