Delacon, a developer of phytogenic feed additives, and Cargill have agreed to a strategic partnership that will advance the market presence of natural, plant-based feed additives on a global scale while meeting changing consumer preferences of what animals are fed and how food is produced.
The deal includes a minority equity investment from Cargill. Terms were not disclosed.
The partnership will connect Cargill's expertise in applied nutrition and global presence with Delacon's know-how and market experience in phytogenic feed additives -- a category that uses natural ingredients, including herbs, spices, other plants and their extracts, such as essential oils, to improve animal performance and secure animal health for sustainable, wholesome food production.
The agreement also will allow the companies to expand their technical and go-to-market capabilities to meet customers' needs around the world as they pursue the joint mission of growing the phytogenic feed additive category.
For Delacon, the partnership will offer access to countries where it does not have a market presence today. For Cargill, the investment expands its presence and capability in the additives space, with a focus on select markets outside the U.S. Delacon's distribution and partnership network will be retained and developed further to make plant-based feed additives more available around the globe.
"Our agreement with Cargill represents an opportunity to accelerate growth and invest in Delacon's future and the future of phytogenic feed additives as our customers are looking for solutions delivered in a natural, efficient and sustainable way, from feed to food," Delacon chief executive officer Markus Dedl said. "Phytogenics are one of the most promising groups of feed additives and are turning from a niche market into a mainstream need. We are entering a new era of phytogenic feed additives, and the next five years are decisive for the developments in this growing market."
This strategic partnership builds on the successful collaboration Delacon and Cargill have built over the last several years. By centralizing these efforts with a strategic partnership, the companies are expanding their focus, presence and reach in the micro-nutrition space.
"Delacon has a strong reputation, recognizable brand and a deep commitment to scientifically driven customer solutions that focus on healthy animals, feed efficiency and performance in a sustainable manner," said Chuck Warta, president of Cargill Premix & Nutrition. "Cargill and Delacon share common values: a commitment to our customers, science-driven innovation and high product quality. We also value a positive and safe work environment for our employees, sustainable and responsible business practices and deep ties to our communities."
Starting as a niche product in the 1980s, micro-nutrition with phytogenics now represents the next frontier for animal productivity and sustainable, wholesome food production, the companies said.
Given the large variety of natural ingredients, phytogenic feed additives are known for broad-spectrum efficacy with an impact on unlocking the nutritional potential in feed, controlling and improving the digestive process, enhancing the gut's microflora and boosting the immune systems of farm animals to promote feed efficiency, keep animals healthy and provide wholesome food while reducing the environmental impact.
Founded and grown as a family business in Austria, Delacon has been a pioneer and global leader in phytogenic feed additives for 30 years. The company researches, develops and produces natural feed additives composed of herbs, spices and essential oils for poultry, swine and ruminants. With 130 employees at 17 locations, Delacon is working to further expand its global footprint.
Cargill provides food, agriculture, financial and industrial products and services to the world.