Glanbia, the Ireland-based global food producer, has splashed out €181 million on two acquisitions to boost its growing performance nutrition business.
It has agreed deals to buy Amazing Grass, a US superfood producer, and Body & Fit, an online retailer based in the Netherlands. The combined net revenues of both companies last year was €99 million.
Glanbia said that the acquisitions had a “strong strategic fit” with its performance nutrition division, which has grown steadily in line with increased demand for sports supplements and healthy snacks.
The €181 million investment will be funded from existing debt facilities. Glanbia declined to give a breakdown of the individual prices for either company.
“Both businesses have a strong strategic fit with Glanbia Performance Nutrition, extending its reach to new consumers and channels,” Siobhan Talbot, the managing director, said. “Amazing Grass produces a range of natural plant-based nutrition products, while Body & Fit is a successful direct-to-consumer online brand. Both businesses have a track record of strong growth and we will continue to invest in their future development.”
The acquisition of Amazing Grass, which makes high-protein powders for use in drinks, represents Glanbia’s first foray into plant-derived protein products.
Body & Fit’s consumer base is largely in Germany and the Benelux countries. Glanbia said that the acquisition would give it direct access to the “rapidly growing” direct-to-the-consumer channel and that it will invest in the business to further its reach into other parts of Europe.
The acquisition is subject to Dutch competition clearance and is expected to close by the summer.
It is understood that the management teams of both businesses will remain in place.
Jack Gorman, a senior equity analyst at Davy stockbrokers, said that “at first glance” the deals were a complementary fit with Glanbia’s brand portfolio.
Amazing Grass filled a gap in the area of plant-based nutrition that the company had been eager to plug for some time, while Body & Fit provided significant growth potential in Europe, he added.
“With the online channel in the US concentrated and dominated by the likes of Amazon and bodybuilding.com, Europe remains a much more fragmented market with only some online-only retailers like myprotein.com making progress across multiple territories,” Mr Gorman said.
Glanbia’s performance nutrition business contributed €923.1 million to the company’s €3.66 billion turnover last year and is expected to surpass €1 billion this year.
In its latest trading update for the first nine months of 2016, Glanbia said that revenue in the division rose by 10.9 per cent on an annual basis with growth across all regions.