Nexira Becomes 100% Independent

21 Sep 2016 --- Nexira has become a 100% privately owned company. The French headquartered natural extracts supplier, which is the global leader in acacia gum, has acquired the 24% of stock that had been owned by financial sleeping partner investor Edmond de Rothschild since 2010. 

The move comes as Nexira looks to expand its position in health & nutrition, with plans in place to grow this part of the business to make up more than 35% of turnover by 2020. This growth should partially come through innovations such as the branded ingredients Cognivia [for cognitive health], Ensotim [for men’s health] and an as yet undisclosed ingredient for weight management. 

Mathieu Dondain, Managing Director of Nexira (pictured) confirmed that the company became 100% independent and family owned, after acquiring these outstanding shares on September 15. “Being family owned and enforcing our independence is a major strategic focus for the company. Nowadays this is not so common, when you see a lot of companies who are deciding to dilute themselves,” he told FoodIngredientsFirst in an exclusive interview. “This is totally understandable when you need to make acquisitions and external growth. But for us, we are a several decades company old and being independent and family owned are very important values in our culture,” he adds. 

Dondain believes that the move will allow the company more flexibility going forward. “We will have more flexibility in terms of making the decisions that we want; whether these are for small acquisitions, medium, or even very big ones.” 

Mathieu Dondain is the fourth generation of the Dondain family to be at the helm of Nexira, which was renamed after the merging of CNI, Bio Serae Laboratoires and NutriProcess under a single banner in late 2011.

He claims that the move towards 100% independence is not going to slow down the company’s need for external growth. “We will just do it a little bit later, because we want to finalize this external growth by the end of 2017, especially in North America,” he says.

Dondain notes that the move will not affect the company’s cash flow, because they had been considering the possibility of acquiring these shares for some time. The shares were partially acquired by debt, but also from personal investments too from his father and Nexira President, Stéphane Dondain, but also including from himself. 

“During the next 12-18 months, we are going to finalize the structure and consolidation, in order to prepare ourselves for external growths. We are working on real organic growth and to prepare for external growth in other areas of the world. But we are not going to be affected by this investment,” he stresses. 

Responses to the move have been positive, both externally and internally, he claims. “Our strategic customers are welcoming and enthusiastic and understand the family values. Internally our executive committee was unanimously involved and welcoming to go into that direction,” says Dondain. 

“If, in a couple of years, we have a very good opportunity to build a partnership with a much bigger company, we could partially sell up. But this would not be a plan before the mid or long term,” he admits.

The company’s complete independence and positive cash flow situation should further benefit R&D and innovation. At Vitafoods 2016 in Geneva, Nexira launched an ingredient based on the cognitive potential of the synergy between two sage extracts: Cognivia. Sage, a well-known plant species from Lamiaceae family, could present many beneficial health effects, notably on memory assessment. The product will also be marketed to the US market for the first time at SupplySideWest in Las Vegas, in October 2016. 

In May 2016, FoodIngredientsFirst reported that Nexira is eyeing the proteins space for the first time; an area where the company has some solid expertise and industrial capacities in extraction and hydrolyzed proteins. Dondain confirmed some progress in this space, although the company is nowhere near the launch of a very precise product and could be hampered by regulatory approval hurdles.

“We are moving along and finalizing our screening and have some potential partnerships with bigger companies. These are long discussions, as regulatory issues will always slow things down a bit. This could take a very long time, especially if it were to enter the novel food or new additive space. We would probably have to do partnerships with others,” he says. 

Dondain revealed that closer to actual market launch is a new potential premium ingredient within the scope of weight management, although no specifics are being revealed at this stage. The company is hopeful of launching the new ingredient at Vitafoods 2017 or SupplySideWest 2017, at the latest. The company already offers three extracts within the weight management space ID-alG (brown seaweed extract), Cacti-Nea (prickly pear extract) and NeOpuntia (a healthy lipophilic fiber from cactus leaves). 

While Dondain was coy on details, he confirmed that the ingredient will not be konjac mannan, despite the approved EFSA claim for weight management. “We are not taking EFSA claims as a key point for a new ingredient launch, as it is too complex.” 

He also confirmed that they are at a further development stage than with the protein. “We are finalizing the screening of the botanical sources and we are also building up the scientific protocols that would go right after, so that we can immediately go with it,” he says. 

An incremental approach to scientific support will be taken, as Nexira eyes the pathway towards commercialization. “We are not going to build a major double-blind crossover or 100-subject study immediately. We usually go incrementally, in identifying and featuring the sourcing and supply chain. We control the bibliography and approval regulatory agencies, before proceeding with our first scientific studies. We also need to assess the potential marketing returns, to see what the market reaction will be,” he stresses.

There is some uncertainty about whether the ingredient itself is approved as a novel food in Europe, which is largely determined by its “history of use” prior to May 1997. “Some extracts from it are approved, but then you have to check which part of the plant really matches the Novel Food Regulation,” he notes.

The product will probably not be derived from an exotic plant, as it can be grown in France or elsewhere. “We have different options for sourcing. It could be from France, but it could also be grown in other areas, as one of Nexira’s qualities is key sourcing from other regions of the world, where we are very present,” says Dondain. 

But while Nexira will be looking to diversify the company in the next 4 years, to look beyond the company’s core business of acacia gum and fiber, it will also be aiming to solidify their leading position there too.

One area that Dondain is very keen to stress is the sustainable sourcing of acacia gum from the Sahel region of Africa and the important role that this will have going forward. “We are working towards sustainable development and especially in terms of protecting natural resources,” he notes. 

The company is increasingly involved in an acacia gum and tree project together with SOS Sahel, an NGO focused on environmental sustainability and agriculture in the Sahel region. Since 2009, SOS SAHEL work with arabic gum pickers to improve their income and the living conditions of their families in Chad and Cameroon.

“We see sustainability as an increasingly important thing, not just for us, but also for environmental reasons. It is also about providing sources of revenue in regions of the world where there has been high levels of migration,” he notes. “Acacia trees and gums have been identified as a potential source of revenue in those areas and are helping to settle some populations. This project is very important to us, as we need to go back to earth on these issues,” he concludes. 

By Robin Wyers