Neptune will quit its bulk krill oil manufacturing and distribution business, with remaining krill oil inventory and IP transferring to Aker BioMarine.
Neptune Technologies & Bioressources Inc. (Laval, QC, Canada) is quitting its bulk krill oil manufacturing and distribution business. Krill oil supplier Aker BioMarine (Oslo, Norway) will be purchasing Neptune’s remaining krill oil inventory and krill oil IP for $34 million.
According to Jim Hamilton, Neptune’s president and CEO, the company will instead continue to focus on the pharmaceutical end of the krill oil market through its existing 34%-investment in krill oil biotechnology subsidiary Acasti Pharma Inc., which is focused on omega-3 phospholipid therapies for hypertriglyceridemia. Neptune will also continue its existing finished-softgel Solutions Business, including krill oil softgels. Aker will now supply bulk krill oil to the Solutions Business.
Neptune will retain its Canadian facility in Sherbrooke, which it will now look at leveraging as it explores new, “high-potential-growth” ingredient categories, but the company says it will largely reduce its staff at the facility.
“This transaction marks an important step in Neptune’s next phase of development,” said Hamilton in a press release. “Neptune believes strongly in the health benefits that krill oil provides and will remain actively involved in this sector via our investment in Acasti Pharma Inc. and also through finished-form soft gel capsules from our Solutions Business. The proceeds from this transaction allow Neptune to accelerate its efforts to position the company in attractive growth segments such as cannabis oil extraction, as well as support further acquisitions consistent with our strategy…We are excited about the opportunities that this transaction will enable for the future and the value creation for our shareholders on a long-term basis.”
Neptune will assist Aker BioMarine in the transition and handoff of existing customers as Aker takes on Neptune’s existing krill oil inventory and IP. According to Aker, the new acquisitions will give Aker “more scale, which allows the company to increase investments in science and product innovation, sustainable krill-harvesting practices, and marketing support.”
“Neptune has made a strategic decision to withdraw as a bulk krill oil supplier, while Aker BioMarine wants to increase investment in the category, so this agreement is a perfect fit for both parties,” said Matts Johansen, CEO of Aker BioMarine, in a press release. “This acquisition will allow us to increase investments in science and product innovation, sustainable krill-harvesting practices, and marketing support for our customers, which in turn will build excitement and accelerate growth in the omega-3 market."
On incorporating Neptune’s NKO brand into Aker’s portfolio, Johansen said, "Neptune’s customers and products will be integrated into Aker BioMarine, including Neptune’s popular NKO brand. These customers will continue to receive the products they are used to and at the same time benefit from the additional products and support Aker BioMarine will offer to drive growth in the omega-3 market.”
He added, "The marriage of these two brands is significant for the krill oil business. We have only just scratched the surface of the potential of krill oil and look forward to bringing NKO into our brand portfolio that we spent a decade building.”