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Nestlé to acquire a majority stake in Vital Proteins – the collagen makers.

Nestlé is acquiring a majority stake in Vital Proteins, a maker of collagen bars, beverages, capsules, and powders.

Vital Proteins will operate as a standalone business and become a part of the Nestlé Health Science’s portfolio. The transaction will equip the Chicago-based collagen maker with the resources to scale its reach and innovation.
Collagen is the most abundant protein found in the body, representing nearly 30% of all human protein content and 70% of the protein content found in the skin, Nestlé said. Collagen production in the body starts to decline at about age 25.

The majority stake it purchased in Vital Proteins adds to the fold a company that specializes in collagen, a key building block for the body. As the company noted, production of collagen starts falling in the mid-20s for most people, so finding a way to add it to the body through Vital Proteins’ bars, drinks and capsules could be important for health and wellness-minded consumers.
SkinnyPop, which Hershey acquired in 2017, released a collagen popcorn last year. It wouldn’t be a surprise to see Nestlé incorporate collagen into Nesquik chocolate milk or Coffee-mate creamers, among other products in its sweeping portfolio.
Nestlé’s addition of Vital Proteins comes as collagen is poised for growth in 2020 as more people look for greater functional health benefits in what they consume
Nestlé, the world’s largest food company, first entered healthcare nutrition in 1986 before forming the Nestlé Health Science and the Nestlé Institute of Health Sciences a quarter-century later as part of its efforts to double-down on the fast-growing business.
Nestlé has looked outside the company and entered into deals to support its efforts, including a partnership with Seres Therapeutics to develop products that help the digestive system. It also funded clinical trials at Accera, a Colorado biotech company, testing medical food for patients with mild or moderate Alzheimer’s disease.
Acquisitions are a big part of that strategy. Last year, it purchased personalized vitamin company Persona, and in 2017 it spent $2.3 billion for privately-held Atrium Innovations, a maker of nutritional health products.
Foods today already have probiotics, vitamins, proteins, and other healthy additives, but as the market for better-for-you products increases, Nestlé’s latest transaction in the health and wellness space could be just the type of under-the-radar deal that sets the CPG giant up for long-term success.

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