Marel is pleased to announce an agreement to acquire Wenger Manufacturing LLC, a global leader in processing solutions focused on pet food, plant-based proteins, and aqua feed. The acquisition of Wenger is a platform investment into new, complementary, and attractive growth markets for Marel and will form the fourth business segment alongside poultry, meat, and fish. The acquisition is subject to customary closing conditions such as anti-trust and approval of Wenger’s shareholders. Total investment for the acquisition is $540 million. The closing of the acquisition is subject to customary closing conditions, including anti-trust and shareholder approval of Wenger, which is expected to take place during Q2 2022.

Marel said the acquisition is fully in line with its 2017-2026 growth strategy which targets 12% average annual increase in revenue through a balanced mix of organic and acquired growth.

Fourth pillar of business model

A new business segment, based on the Wenger platform, will constitute Marel’s fourth pillar alongside poultry, meat and fish, and will be focused on the sizeable and attractive growth markets of pet food, plant-based proteins and aqua feed.

This new growth platform is an important addition to Marel’s product portfolio to meet customers’ rising demand for high-quality food and feed that is processed in a sustainable and affordable way, the company said.

The two companies have a great strategic and cultural fit with highly complementary product portfolios and geographic presence, creating a strong platform to enhance further growth. Wenger shares Marel’s passion for innovation and commitment to best-in-class products, backed by an experienced team and long-standing partnerships with customers. Wenger enjoys a diversified and loyal customer base ranging from blue-chip pet food processors to startup companies in plant-based proteins. This has resulted in healthy profitability, strong cash flow and solid return on invested capital. Capitalizing on Marel’s global reach and digital platform, the two companies are well positioned to explore future growth opportunities together.

Growth platform into new, attractive growth markets

The global petfood and aqua feed markets are estimated at over EUR 100 billion and EUR 50 billion respectively and growing at 5-6% annually. The plant-based protein market is currently around EUR 7 billion and expected to grow 15-20% annually.

The addressable market for Marel and Wenger in solutions and services within pet food, plant-based proteins and aqua feed is estimated to be around EUR 2 billion with expected annual growth of 4-6%, in line with Marel’s long-term market growth expectations. Marel aims to grow faster than the market, based on its continuous innovation and global reach.

Throughout the years, Marel has gradually expanded its playing field and is now the only pure-play provider of full-line solutions, software, and services to the poultry, meat, and fish industries. In the vision solidified in 2016, the scope was widened from the three animal proteins to focus more generally on transforming food processing. In 2020, Marel announced an increased focus on adjacent markets and in 2021 it formally established a business development division focused on pet food and plant-based proteins. Adding Wenger’s strong capabilities in that area, Marel is accelerating its journey and is well positioned to capitalize on providing transformational solutions to the large and attractive growth markets of pet food, plant-based proteins, and aqua feed.

“We are thrilled to join forces with the great team in Wenger with whom we have a strong strategic and cultural fit,” said Arni Oddur Thordarson, CEO of Marel, “Wenger’s passion for innovation and commitment to high-quality solutions, in addition to their excellent customer focus and talent management, are the key attributes Marel is proud to partner with. Wenger is a true leader in its field of providing solutions and services to the pet food industry and aqua feed industries and has in recent years made its mark on the fast-growing plant-based protein consumer market with best-in-class solutions positioned right in the center point of the value chain.”

Thordarson said Marel has a strong financial position to pursue future growth avenues and a proven track record in driving long-term value creation. “I am confident Marel will be a good steward for the Wenger business, its talented team and continued local community engagement, and we remain committed to our continued future success.”