Nestlé Health Science to expand plant-based protein portfolio with Orgain acquisition
03 Feb 2022 --- Nestlé Health Science is slated to acquire a majority stake in plant-based nutrition company Orgain.
“This is an exciting acquisition for us, tapping into consumers’ growing awareness of the advantages of protein nutritional supplements in supporting their health and wellness,” Jacquelyn Campo, senior director, corporate communications, Nestlé Health Science, tells NutritionInsight.
The deal is expected to be slightly accretive to Nestlé’s organic growth, while slightly dilutive to the Group’s underlying trading profit margin in 2022. The agreement includes the option for Nestlé Health Science to fully acquire Orgain in 2024. Further financial details were not disclosed.
Expanding global reach
According to Campo, Orgain’s clean, protein-based products complement Nestlé Health Science’s existing health and nutrition portfolio in terms of channels and brands.
“Orgain currently has only a limited presence outside the US. We intend to use our own footprint to make the business stronger in existing markets and also enter new markets.”
Nestlé Health Science is already active in protein powders, including plant-based, through Garden of Life. Orgain is slated to join the company’s current range with a complementary portfolio of products delivered through different channels.
The acquisition aims to expand the presence of both companies in new markets.
Plant-based
The majority stake will be purchased from Orgain’s founder Dr. Andrew Abraham and Butterfly Equity, who will continue to be minority shareholders. Abraham will continue to serve as CEO of Orgain.
Butterfly acquired its stake in Orgain, along with the Ontario Teachers’ Pension Plan, in 2019.
“This acquisition will allow Nestlé Health Science to reach more people around the world who want to improve their health through clean, protein-based nutrition,” Campo underscores.
The company’s deal to further plant-based nutrition is reflective of Innova Market Insights’ number two Top Ten Trends for 2022, “Plant-Based: The Canvas for Innovation.” Consumers consider plant-based alternatives to be healthier and better for the planet, driving R&D across industry.
Building partnerships
Orgain was founded in 2009 in California, developing protein-based shakes, powders and snacks. In 2020, it also delved into the sports nutrition market.
“Nutritional protein plays a key role in supporting our health and wellness, whether we enjoy an active lifestyle or are facing health challenges,” says Greg Behar, CEO of Nestlé Health Science.
“Orgain’s emphasis on clean, all-natural, plant-based, organic ingredients has made it a leader in the US, and we look forward to combining our companies’ expertise to bring Orgain to more people around the world,” he adds.
Nestlé last year completed its US$5.75 billion acquisition of The Bountiful Company’s core brands, which include Nature’s Bounty, Solgar, Osteo Bi-Flex, Puritan’s Pride, Ester-C and Sundown.
In 2020, the company also acquired the majority stake in Vital Proteins, a key US collagen player featuring a lifestyle and wellness platform offering supplements, beverages and food products.
By Andria Kades
