Amazon buys Whole Foods, Nestlé buys Atrium Innovations: Here's a 2017 recap of big mergers and acquisitions

This year was a year of big M&A announcements. In case you missed it, we've compiled a short round-up of some major merges and acquisitions relevant to the dietary supplement industry:

Nestlé buys Atrium Innovations for $2.3 billion

The food and beverage giant Nestlé agreed to acquire Canadian supplement maker Atrium Innovations, which makes Garden of Life and Pure Encapsulations, earlier this month for $2.3 billion. It was a sign that the Swiss-based multinational is continuing its endeavor in the consumer healthcare arena.

"Atrium's established brands are in attractive categories and have the potential for continued strong growth as part of Nestléthrough category, channel and geographic expansion,” said Nestlé health sciences CEO Greg Behar.

Nestle-buys-Atrium-for-2.3-billion_wrbm_large.jpg
Switzerland-based food giant Nestlé agreed to acquire Canadian firm Atrium Innovations, which makes dietary supplements sold through the healthcare practitioner channel.

By purchasing a supplement company that sells through the practitioner channel, companies like Metagenics, Thorne Research, and Standard Process can now count Nestlé as a competitor.

Amazon buys Whole Foods for $13.7 billion

In an announcement that shook the retail sector, ecommerce giant Amazon bought natural food grocer Whole Foods in June for $13.7 billion.

Financial analysts mostly agree that over the longer term, the deal could be a game changer for the US grocery market. Additionally, a consumer survey by GfK found that consumers viewed the deal positively, leading analysts to conclude that the acquisition could help push more shoppers to ecommerce.

Kerry Group buys Ganeden

Irish ingredient manufacturer Kerry Group bought Ohio-based probiotic manufacturer Ganeden, maker of BC30, for an undisclosed sum in October.

According to Kerry, the acquisition of Ganeden will complement the group’s 2015 acquisition of Wellmune, adding that Ganeden's technologies will be extended into wider applications across the company’s global markets.

Ashland buys Pharmachem

The publicly traded, global chemical giant Ashland acquired nutraceutical contract manufacturer and ingredient supplier Pharmachem Laboratories for $660 million in April.

Flexing its muscles for the nutraceutical industry, Ashland announced earlier this month that it has established a new business unit, called Ashland Health & Wellness, to focus even more on functional food, beverages, and dietary supplements.

We are focusing on creating products and services that combine the nutraceutical expertise of Pharmachem, and the nutrition and excipient know-how of Ashland, to create a global presence in the nutraceutical/food market,”​ David Neuberger, Group VP of Pharma, Health and Wellness, and Agriculture at Ashland Global Holdings Inc., told NutraIngredients-USA.

Nellson Nutraceutical buys Genysis Brand Solutions

Protein powder specialist Nellson Nutraceutical acquired Genysis Brand Solutions for an undisclosed sum earlier this month, a move that will give Nellson a bigger presence in the nutritional shakes and bar category.

Genysis’ affiliates Dyad Labs and Sensapure Flavors were not included in the acquisition and are now independent companies.

From the acquisition, Nellson will also have a small run capability and much smaller blenders than it already has, allowing to service growing brands more efficiently, SVP of commercial development Bart Child told NutraIngredients-USA.

Nellson Nutraceuticals is a portfolio company of private equity firm Kohlberg & Company.

Pfizer considers sale of healthcare business, including Centrum, Emergen-C

Pfizer-considers-sale-of-Consumer-Healthcare-business_wrbm_large.jpg
Pfizer announced that it is considering a sale of its Consumer Healthcare business, which includes Emergen-C and Centrum.

In October, Pfizer announced that it is “reviewing strategic alternatives” for it Consumer Healthcare business, which includes many iconic over-the-counter brands from dietary supplements to personal care.

Financial analysts estimated the unit to cost around $15 billion. Though some outlets reported that Pfizer was set to launch an auction of its Consumer Healthcare business in November, no news has come out of it yet.

Innophos buys Novel Ingredients for $125 million

NASDAQ-traded phosphate company Innophos acquired New jersey-based ingredient manufacturer Novel Ingredients in August, part of the company’s ongoing plans to expand its human nutrition reach through acquisitions.

“The reality is that the markets that we have traditionally served with our phosphate portfolio, including many industrial markets, continue to face challenging market environments and are expected to grow at GDP at best,” Kim Ann Mink, chairman, president, and CEO of Innophos Holdings told NutraIngredients-USA.

The acquisition of Novel Ingredients will “more deeply [align] the company with consumer mega trends like energized aging, health and wellness and clean labels,” she added.

Mergers and Acquisitions

acquisition-merger-business-deal.jpg

You can find more of our dietary supplement merger and acquisition news stories HERE

KKR buys majority stake in Nature’s Bounty

This past July, global private equity firm KKR (also known as Kohlberg Kravis Roberts) bought a majority control of supplement giant The Nature’s Bounty Co. from another private equity firm, The Carlyle Group.

Financial terms were not disclosed, but a Reuters report speculated that the company could fetch as much as $6 billion on the open market.

Lonza buys Capsugel for $5.5 billion

Speaking of KKR, the private equity firm sold dosage form company Capsugel to Switzerland-based Lonza in July for $5.5 billion. KKR had bought Capsugel from Pfizer in 2011 for $2.4 billion.

“Lonza and Capsugel have a highly synergistic customer base and market approach, complementary business models and closely aligned corporate cultures with a strong commitment to ethics and compliance. All of these aspects will facilitate a seamless integration,” said Richard Ridinger, Lonza's CEO.

The $5.5 billion transaction price includes approximately $2 billion for refinancing of existing Capsugel debt. Capsugel’s business will continue to operate in its existing structure until the full integration has been completed, said Lonza.

Reckitt Benckiser buys Mead Johnson Nutrition

UK-based Reckitt Benckiser Group announced in February that it will acquire all of Mead Johnson Nutrition shares for $90 each in cash, totaling to approximately $16.7 billion.

The transaction was fully completed in June. As a result, common stock of Mead Johnson, maker of infant and children nutrition brands like Enfamil, are no longer traded on the New York Stock Exchange.