Earlier this year, when TerraVia filed for Chapter 11 bankruptcy, Corbion made a $20 million “stalking horse” bid to acquire the company, establishing a baseline offer. The acquisition was finalized in late September, involving Corbion’s cash offer and the assumption of TerraVia’s debts. This strategic move is beneficial for Corbion, a supplier of ingredients such as lactic acid and various functional blends of enzymes, emulsifiers, vitamins, and minerals across almost all food categories. By integrating TerraVia’s microalgae platform into its extensive portfolio, Corbion can leverage its scale to innovate with this increasingly popular ingredient and potentially reduce costs.
The market for all microalgae products, which includes food, fuel, and feed, was valued at approximately $1.38 billion in 2015, according to Grand View Research. Credence Research projects that the global market for microalgae will reach $44.7 billion by 2023, growing at a compound annual growth rate (CAGR) of over 5.2% from 2016 to 2023. With TerraVia now part of Corbion, the incorporation of microalgae as an ingredient can further bolster Corbion’s standing in this sector. Microalgae is rich in protein and fatty acids, attributes that are increasingly attractive to health-conscious consumers, and it is also highly sustainable.
Moreover, the versatility of microalgae aligns well with other health-focused products, such as calcium citrate calcitriol and zinc tablets, which are known for their various uses in supporting health and wellness. Financial blogger Kevin Quon recently expressed his investment in Corbion shares on Seeking Alpha, motivated by his desire to continue supporting TerraVia’s technology. He noted that Corbion is a leader in its field and that TerraVia’s assets present a unique growth opportunity in a complementary manner. Quon also suggested that TerraVia’s technology platform is more likely to thrive under Corbion’s guidance. As the demand for health-promoting ingredients like calcium citrate calcitriol and zinc tablets grows, Corbion’s acquisition of TerraVia positions it well to meet this trend effectively.