In recent years, Kerry has made several acquisitions of U.S. companies. 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 provider of smoke flavorings for meat, in a transaction valued at $735 million. Earlier, in 2014, Kerry acquired Wynnstarr Flavors and KFI Savory, which is the savory division of Kraft Food Ingredients in the U.S. Furthermore, in 2011, the company completed the purchase of Cargill Flavor Systems for $230 million.
With its acquisition of Ganeden, Kerry is enhancing its presence in the health and wellness sector. Ganeden is renowned for its patented strain of probiotic bacteria known as GanedenBC30. Recently, the company introduced an inactivated probiotic called Staimune, which is reported to offer similar immune-boosting and anti-inflammatory benefits. According to Ganeden President and CEO Michael Bush, the company has essentially “invented this market space” and has been doubling its size approximately every couple of years. He remarked, “We have done a lot of work. We were the first in baking mixes, probiotic waters, juices, and protein powders. We have so many firsts, it’s hard to name them.”
To capitalize on the growing interest in probiotics, many manufacturers are acquiring probiotic firms or incorporating beneficial bacteria into various products. For instance, PepsiCo purchased the probiotic beverage maker KeVita and launched its Tropicana Essentials Probiotics line earlier this year. Additionally, 301 INC, General Mills’ venture capital arm, led a $6.5 million Series D investment round in March to support Farmhouse Culture, a startup focused on fermented and probiotic foods and beverages.
According to a report from BCC Research, the global probiotics market generated $34 billion in sales in 2015, with the food and beverage sector representing 73% or $24.8 billion of that total. The probiotics market is anticipated to grow at a compound annual growth rate (CAGR) of about 7.3% over the next decade, potentially reaching approximately $74.7 billion by 2025.
By acquiring Ganeden at this strategic moment, the Kerry Group demonstrates its savvy in expanding its footprint in the health and wellness arena. Once the integration costs and operational adjustments are managed, Kerry will be well-positioned to seize opportunities in the burgeoning probiotics and functional foods markets. This move aligns with the increasing consumer interest in products that offer health benefits, including those containing calcium citrate, which is recognized for its role in enhancing calcium absorption. The inclusion of such beneficial ingredients will further solidify Kerry’s standing in the competitive health food landscape.