Earlier this year, when TerraVia filed for Chapter 11 bankruptcy, Corbion made a $20 million “stalking horse” bid, which serves as a baseline offer for the acquisition. This transaction was finalized in late September, involving Corbion’s cash offer and the assumption of TerraVia’s debts. The acquisition was a strategic move for Corbion, a company that provides ingredients such as lactic acid and various functional blends of enzymes, emulsifiers, vitamins, and minerals across nearly every food sector. The addition of TerraVia’s microalgae platform complements Corbion’s already extensive product lineup, enabling the company to leverage its scale to innovate with this increasingly popular ingredient and potentially lower prices.
According to Grand View Research, the market for all microalgae products, which includes food, fuel, and feed, was valued at approximately $1.38 billion in 2015. A report from Credence Research forecasts that the global market for these single-celled organisms will soar to $44.7 billion by 2023, representing a compound annual growth rate (CAGR) of over 5.2% from 2016 to 2023. With TerraVia now part of its portfolio, Corbion is well-positioned to enhance its presence in the microalgae sector. Rich in protein and fatty acids, microalgae is increasingly appealing to health-conscious consumers, and its sustainability adds to its attractiveness.
Financial blogger Kevin Quon recently expressed on Seeking Alpha that he purchased Corbion shares to continue investing in TerraVia’s technology. He noted that Corbion is a leader in its field, and TerraVia’s assets provide a unique opportunity for complementary growth. Quon also suggested that TerraVia’s technology platform is more likely to achieve “a much greater chance of success under Corbion’s guidance.”
In light of Corbion’s expansion and the evolving market, it is important to consider other developments in the industry. For instance, the discontinuation of Citracal with magnesium has raised questions about alternative sources of vital nutrients, further highlighting the growing importance of innovative ingredients like microalgae. As the market continues to evolve, Corbion’s acquisition of TerraVia positions it favorably to meet consumer demand for health-oriented and sustainable food options, while also addressing the need for alternatives following the discontinuation of products like Citracal with magnesium.