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Gadot allies with UTEK in new technology hunt

By Jess Halliday , 19-Jul-2006

Gadot Biochemical Industries is on the lookout for new ingredients in the health food sector, and has entered into a strategic alliance with UTEK Corporation to identify and evaluate emerging technologies from research institutes around the world.

For the first 30 years of its existence, Israel-based Gadot specialised in citric acid, but in the early 1990s it turned its attention towards minerals for the food fortification and supplements market.

It developed a process to make calcium citrate and other mineral salts using raw citric acid as the base material, and now makes 35,000 tons of citrate salts per year and only 10,000 tons of citric acid. A further 30,000 tons of the sweetener crystalline fructose has also helped drive growth, with its GM-free profile giving it a strong customer base in Europe where it commands a price premium over the rival US-made product.

So far this year Gadot has launched two value-added calcium salt products: Gaducol Extreme and Gaducol K. Both are designed to resolve issues faced by beverage makers looking to add low solubility calcium salts to specific drinks - syrup-based beverages and soymilks respectively.

However the deal with UTEK is not the first signal that the company is seeking to spread its wings in a new direction. In January it said that it was looking for potential acquisitions in Europe or the US in order to grow its ingredients portfolio.

No announcements have been made to date, but the overarching strategy may be a means to protect its strong growth momentum, in response to increasing competition from Chinese minerals business. It is estimated that China will control 50 per cent of the global citric acid market by the end of this year.

VP of business development Ronny Hacham told NutraIngredients.com that UTEK is in close contact with Universities has a database of emerging technologies, and the capacity to evaluate them.

UTEK will present the company with some options, from which it can then chose "based on synergies with our production processes and markets," said Hacham.

He said that, without organisations like UTEK, he is not sure how a company of Gadot's size would have access to interesting new technologies.

Gadot has set no budget for technology acquisition or licensing, but will make a decision on a case-by-base basis.

The alliance is in its very early stages, and it is expected that it will be at least two months before suitable options are identified.

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