Oterra to acquire India-based Akay Group as it bolsters position in natural colors arena
07 Jul 2022 --- Oterra is on track to acquire Akay Group, a natural ingredients manufacturer based in India. The transaction was signed this month and is subject to regulatory approval. Financial details of the deal have not yet been disclosed.
This latest acquisition, Oterra’s fourth in 14 months after a buying spree that included Diana Foods and Secna Natural Ingredients, is poised to strengthen its access to natural colors and an attractive product pipeline backed by state-of-the-art manufacturing plants and strong R&D capabilities.
Investec served as the exclusive financial advisor to Akay Group and its existing shareholders. JSA served as legal counsel to Akay Group.
Expanding capabilities
Akay is a great strategic match for Oterra, according to Cees de Jong, chairman of Oterra. “It adds to Oterra’s core-strength – natural colors and its portfolio of nutraceutical products complements Oterra’s existing portfolio of products for natural dietary supplements.”
“The demand for all-natural products in this market is rising,” Jong notes.
Backing this notion, FoodIngredientsFirst recently reported how the natural colors space continues to gather speed in its shift toward close-to-nature ingredients, which are phasing out artificial dyes.
Founded in 1995, Akay Group is a key player in the natural colors and nutraceutical ingredients industry.Aside from this, the growing demand for nutritionally functional solutions provides significant opportunities in clean label pigments.
Spice hub for India
Based in Kerala, India’s spice hub, Akay serves over 40 countries, has four manufacturing sites in southern India and employs more than 400 people.
“We have a shared history that has left a significant imprint on our business understanding and culture, and we share many of the same values. I am confident that Oterra’s innovative mindset will bring great value to Akay’s customers. In many ways, this is like a homecoming for us,” says Dr. Balu Maliakel, managing director, Akay.
The two companies have a long-standing connection. Oterra, previously known as Chr. Hansen Natural Colors, before its purchase in 2021, was in 1995 part of a joint manufacturing venture with Akay to produce natural colors from turmeric and paprika.
From 2007, Akay continued as an independent company, but Oterra and Akay have kept close ties since Akay is a key supplier to Oterra.
“In recent years, Akay has successfully transitioned from a pure colors and flavors business to a leading science-backed botanical ingredients business. We both believe in bringing the best of nature to the world and we’re happy to welcome the team at Akay to Oterra” adds Odd Erik Hansen, CEO, Oterra.
Edited by Elizabeth Green
