Karro Food Group (UK) Acquired Young’s Seafood Limited to Explore Multi-protein Food Groups

Posted by MarketsandMarkets on Jul 11, 2019 10:45:51 AM
MarketsandMarkets

Karro Food Group, a subsidiary of the UK-based CapVest Partners, is a meat processor that has agreed to acquire Young’s Seafood Ltd. with the aim to create a new multi-protein food group.

Marketsandmarkets™’ View Point:

Karro Food Group is a UK-based meat processor engaged in the production of bacon, gammon, fresh pork, frozen sausage, ham, and cooked meats. The acquisition of Young’s Seafood Ltd would facilitate the companies to broaden their respective product portfolios with the inclusion of two significant protein categories that are experiencing steady long-term growth in the food industry—pork and fish. Post transaction, the companies will continue to operate as one standalone entity under the enlarged group of CapVest. According to Mahima Solanki (Research Associate, Food, Beverage and Agriculture Research at MarketsandMarkets™), the increase in demand for multi-protein food among the population has been propelling the market growth. The diversification of the product portfolio by Karro Food would help the company to cater to the customers with multiple options of the protein-based diet with pork and fish. The increasing trend of urbanization and rising income leads to growth in consumer preference toward protein-rich food, which further supports the growth of multi-protein food group market.

Impact of Acquisition:

Karro Foods is well known for its pork meat production. The company processes and delivers swine to the UK’s major supermarkets and food suppliers across the country. As the company deals with processing delivery of pork meat, the inclusion of one more protein rich-food—fish—in its product portfolio through the acquisition of Young’s Seafood would help the company with better positioning in the market, coupled with diversified product portfolio. Amarnath Rajendran (Associate Manager- Food, Beverage, Animal Nutrition, and Agriculture at MarketsandMarkets™) identified that the acquisition offers an opportunity for the company to create a multi-protein food business of a substantial scale. Young’s and Karro deal with complementary businesses, and the combination will lead to a strong market position in the two most important protein segments of food. In recent years, consumer awareness regarding the role of animal-based protein in health and wellbeing has increased, resulting in a rising demand for protein-rich food. However, with the recognition of the negative relationship between animal-based protein production and greenhouse gas emissions, the spotlight is shifting toward alternative protein sources.

The figure given below showcases the current market opportunity in the plant protein ingredients market. The market for plant protein ingredients is estimated to grow at a high rate; changing consumer preferences from meat to plant protein is one of the main reasons driving the market for plant protein ingredients as an alternative protein source.

FIGURE 1 PLANT-SOURCED PROTEIN INGREDIENTS MARKET, 2019 VS. 2025 (USD BILLION)
Plant-sourced Protein Ingredients Market


e - Estimated, p - Projected
Source: Related Research Publications, Government Publications, Company Press Releases, Company Annual Reports, Company Websites, Company Publications, and MarketsandMarkets™ Analysis

Impact on the top competitors:

The major inspiration of the above-discussed acquisition was the revenue hike of the Hilton Food Group in 2018 due to the integration of the Seachill UK business, along with the acquisition of the shrimp contract for the UK retail giant, Tesco. Likewise, the acquisition would help Karro Foods to gain a larger market share through the supply of pork meat as well as seafood. However, with the increasing sustainability issues, key players in the market are switching toward alternative sources of protein. Increasing investment by food and commodity companies in alternative protein startups such as the investment of Cargill (US) in Puris and Tyson Foods (US) in Beyond Meat and Future Meat Technologies signifies the potential growth of alternative protein sector. Thus, companies such as Karro Foods should make efforts in diversifying their capabilities in terms of alternative sources of proteins such as plant-based meat.

Conclusion:

The acquisition of Young’s Seafood by Karro Food Group would aid the growth of the company and the expansion of its product portfolio from pork meat to seafood. The diversification in the product portfolio allows the company to cater to a large number of supermarkets and also helps in creating a combined platform with two of the rich protein source categories. The growing demand for animal-based protein, with the realization of the importance of meat products in the health and nutrition of the consumers, are the major drivers for this market. However, the investment by major players in protein alternatives due to sustainability issues may have a negative impact on this market.

For more information, please write to us at info@marketsandmarkets.com

Topics: Food and Beverage, Young’s Seafood Limited, Protein Ingredients Market, multi-protein food, Karro Food Group (UK)

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