Friday 18 October 2019

Kerry snaps up meat-substitute manufacturer as market booms

Kerry Group CEO Edmond Scanlon. Photo: David Conachy
Kerry Group CEO Edmond Scanlon. Photo: David Conachy

Gretchen Friemann

Kerry Group has swooped on a Dutch substitute meat company controlled by a Belgian private equity firm, as the international food conglomerate notches up its fourth bolt-on acquisition so far this year.

Ojah BV manufactures "textured meat alternatives" according to its website, creating products from plant-based materials that are "rich in proteins, low in fat and salt, high in fibre" and free of cholesterol.

The company is controlled by Korys Fund Investments, the investment arm of the wealthy Colruyt family - the eponymous founders of Belgium's discount supermarket chain.

While this latest deal, at less than €20m, is relatively small, it reflects Kerry's deepening commitment to the rapidly expanding plant-based protein sector, which is expected to reach a value of more than €13bn by 2022.

The Tralee-based food, ingredients, and nutrition group launched its plant-based ProDiem brand at the end of 2016 as food allergies, ecological concerns and a consumer backlash against salt, sugar and artificial ingredients continues to force a multibillion shift in consumption patterns. While changing taste patterns have carved out new growth markets in protein snack bars and drinks, creating meat alternatives that appeal to carnivores have been hailed as the holy grail for investors.

Last year, Microsoft's founder, Bill Gates, Hong Kong billionaire, Li Ka-shing and a Facebook founder all pumped money into the Silicon Valley-based Impossible Foods, which aims to disrupt America's beef industry by creating burgers that taste the same as the real thing. Bruce Friedrich, executive director of the US lobby group Good Food Institute, last year described the plant-based and "clean meat" industries as two market sectors "that are about to explode". "Anyone getting in now will be rewarded in very short order," he said.

Ojah first launched its products in 2010, and by 2016 had rolled out a meat substitute under the Plenti brand in over 21 countries. According to its website the firm now produces 1,600 tons of Plenti per year.

Kerry has built its growth on close to €5bn worth of acquisitions since 2000 and the group is expected to ramp up this trend over the next 18 months with management recently pointing to a €1bn pipeline of acquisition opportunities, particularly in Asia.

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