Above Food Ingredients acquires pet food ingredient division for US$34M

USA – On August 9, 2024, Above Food Ingredients, a leader in food ingredients with a vertically integrated supply chain, announced its acquisition of The Redwood Group’s (TRG) Specialty Crop Food Ingredient division for US$34 million. 

This strategic move will significantly enhance Above Food’s market presence, particularly in the North American pet food industry.

The Specialty Crop Food Ingredient division, known for its high-quality grains, pulses, and speciality crops, operates through a vertically integrated model that spans from farm to consumer. 

This integration differentiates the division from commoditised food suppliers and allows it to achieve higher margins. 

In the fiscal year ending December 31, 2023, the division reported revenue of US$164 million, with an average adjusted EBITDA of US$5.3 million over the past three years.

The acquisition is poised to expand Above Food’s reach in the North American market. The division’s sales are dominated by the pet food sector, which accounts for about 40% of its sales.

The acquisition aligns with the growing consumer demand for plant-based pet and human food products. 

Lionel Kambeitz, founder, president, CEO, and executive chairman of Above Food, highlighted that the acquisition not only strengthens the company’s international footprint but also perfectly aligns with its “Seed-to-Fork” approach, which ensures control over the entire supply chain from quality to sustainability.

This acquisition marks Above Food’s first U.S. physical facilities and integrates TRG’s division’s strong relationships with growers, suppliers, and customers into its operations. 

The Specialty Crop Food Ingredient division is expected to advance Above Food’s direct customer relationships, enhance value-added capabilities, and optimise margins. 

The division’s diverse supplier network and commitment to sustainable farming practices will also help mitigate risks associated with localised crop conditions.

Mike Kincaid, founder and president of TRG, described the sale as a significant milestone in TRG’s history, noting the growth opportunities it presents to their teams in Mission, Kansas, and Chester, Montana. 

He expressed confidence in Above Food’s ability to utilise and expand the margin structure of the acquired assets, ensuring continued innovation and success in the speciality crop sector.

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