Alpro, a division of Belgium’s Vandemoortele, was put up for sale in January so its parent company could focus on bakery and lipids. This prompted considerable speculation about major firms eyeing expansion in soy.
Dean Foods confirmed yesterday that it is to pay around €325m for the business, which it says “establishes it as a clear leader in branded soy-based beverages and related products category”.
Gregg Engles, Dean Foods chairman and CEO, said: “This is one of the most strategic assets we could have acquired. We see significant growth opportunities to leverage the collective strengths of both businesses across a global soy platform to accelerate growth.”
Market impact
Gerard Klein Essink, director of Bridge2Food (formerly ProSoy Research & Strategy) told FoodNavigator.com that a huge company in branded soy products “will be a good basis for growth and brand management – and consequently for bigger market development”.
He also believes that the marketing clout Dean Foods brings will help improve consumer awareness.
But in Europe there is already greater breadth of the soy category in terms of SKUs (stock keeping units) than in the US, which could limit the innovation influence.
Asked whether innovation could flow in the other direction, from Europe to the US, Essink said “possibly – but the markets differ in structure, content and unity of consumers”.
Essink said that growth is continuing in the meat-free and dairy-free sectors, but at a slower rate than the 25 per cent growth seen four or five years ago.
Deal details
Alpro, which has five manufacturing sites in Belgium, the UK, France and The Netherlands, will be run as a separate European business. It currently employs around 750 people.
Comprised of the Alpro and organic Provamel brands, it had sales of around €260m in 2008.
Once Alpro is fully integrated, Dean Foods expects the two businesses to have combined retail sales of US$1bn.
The transaction is expected to close in the third quarter. The final sale price is considerably higher than the original €200m tag borne by Alpro when it was put up for sale.
Reports put the likes of Nestle, Unilever, Groupe Danone and PepsiCo in the bidding – although none would confirm its interest.
Private equity firms were reported to have been interested but subsequently withdrew after out-bidding by potential trade buyers. Private equity buyers have had their buying-power clipped by the recession.