Nactarome is extending its reach into the premium, natural seasoning market through the deal that will see it take control of Gloucestershire-based TasteConnection for an undisclosed sum.
Founded in 2002, TasteConnection has a core focus on the snacks and savoury markets. The company works with customers to develop bespoke flavouring solutions, leveraging provenanced ingredients, natural flavourings and culinary products. TasteConnection has a ‘strong presence’ in the handmade crisps, chips, and ready meals markets and a client base of over 70 of the largest UK snacks producers and food brands, as well as many niche UK brands.
Significantly for Nactarome, this marks the European supplier’s first forray into natural seasonings. “The acquisition brings several interesting things to the table,” Wenzel told this publication. “Most important is seasoning know-how in the premium segment. It is an area we are [currently] not serving at all. We want to make sure this is available across our business.”
Nactarome will therefore leverage TasteConnection’s expertise in its existing European sales channels. And the sales synergies don’t end there. The company plans to deepen TasteConnection’s offering by feeding Nactarome’s competnencies into TasteConnection’s UK customer base.
‘Nactarome serves as an industry consolidator’
This is a familiar model for Nactarome’s M&A strategy. The company has positioned itself as ‘an industry consolidator’, expanding its reach in Europe by offering smaller, often national players the opportunity to access new markets and expand product ranges under its umbrella.
Since 2018, when Ambienta became a majority stakeholder in the Italian ingredient firm, the company has grown significantly, Wenzel revealed. It’s revenue has increased from around €30m to a projected €130m this year, primarily driven by acquisitions.
The group’s M&A strategy has been guided by the aim of developing its expertise in key segments – including sweet, beverage and savoury – as well as extending its geographical reach. Today, it has spread its manufacturing footprint to twelve specialised plants in Italy, the UK, France and Belgium, and built a diversified customer base of over 4,200 clients served across more than 100 countries.
“We now have the unique opportunity to leverage competencies through our regional reach,” the group’s executive president explained.
Boxing above its weight: ‘Bigger competitors have it all in-house’
This strategy has allowed Nactarome to thrive in a sector where, Wenzel noted, ‘bigger competitors have it all in-house’.
“We are building out competencies by bringing local specialists together,” he explained.
The ‘biggest part’ of Nactarome’s business caters to SMEs in a food sector that is ‘only partly consolidated’. The company’s approach means it can ‘help smaller companies’ have access to a greater range of technology and expertise. “We call it global solutions, local expertise,” Wenzel told us. “We are trying to help our customers have access to innovative technology and trends, be it clean label, vegan, sugar reduction, fat and salt reformulation.”
So what next for the amitious and acquisitive firm? Is more M&A on the cards?
It sounds likely, with an initial focus on expansion in Germany and Spain. Indeed, last week Nactarome secured its first foothold in Germany with the acquisition of its Frankfurt-based life sciences distributor Pharm Organa. “They have little presence in food and beverage, we will develop this to create a presence in Germany,” Wenzel revealed.
“Another market that will be important for us is Spain. We already have a significant export business. We have to consolidate that.”
In the longer term, the company is also eyeing growing its global reach beyond Europe.
“We are at critical mass in Italy. We are close to critical mass in Europe. We are looking into other areas of growth outside Europe, interesting growth markets of the world – and that is obviously looking East.”