Cargill buys animal nutrition company

The Minneapolis-headquartered agricultural giant positioned the investment as part of ongoing efforts to meet increasing consumer preference for ‘natural and wholesome food.’

Cargill announced last week that it has agreed to purchase Diamond V, a Cedar Rapids, Iowa-based producer of nutritional products designed to improve health in food animals and companion animals.

Financial details of the transaction were not disclosed.

Diamond V’s products support immune function and digestive health in feed for dairy, beef, aquaculture and other livestock sub-sectors. They are sold in more than 50 countries and also include human health business Embria Health Science and EpiCor, a branded food product made through a specialized fermentation process.

“This investment will enable Cargill’s animal nutrition business to better serve customers who are increasingly turning to unique natural technologies to unlock the potential in feed to promote healthier animals, improve performance and help them produce safer, more wholesome food. Natural immune support products in animal feed – like natural health supplements for people  – are increasingly being used to improve immunity and digestive health,” Cargill said in its statement.

National Securities Corporation managing director for food and agribusiness Ivan Saval told Agri Investor in an email that Cargill’s purchase of Diamond V was evidence of the continued search for profit among large agricultural companies.

“Cargill’s pivot towards more socially responsible investing in the food chain, supporting entrenched downstream consumer trends, continues,” Saval wrote.

In its statement, Cargill linked the Diamond V purchase to its recent acquisition of Delacon, an Austrian company that produces feed additives derived from plants, as part of its efforts to claim a leadership position in what it called a $20 billion global animal feed additives market.

Diamond V president and chief executive Jeff Cannon characterized the sale as “an investment in the well-being of animals –  and ultimately, in people.”

Cargill’s purchase is the latest in a series of recent private investments in the animal feed sector, with Cargill itself having bought the animal feed business of Virginia-based farm supply retailer Southern States Cooperative in August.

In June, lower-mid market private equity firm Lariat Partners sold Westfeed, a subsidiary of its portfolio company Northern Agri Holdings focused on feed additives designed to assist digestion and encourage grazing, to Ridley USA for an undisclosed sum.

Later that month, Tillridge Global Agribusiness Partners portfolio company Novita Nutrition opened a $95 million facility in South Dakota dedicated to the production of digestible protein for dairy cattle feed. April saw Canada Pension Plan Investment Board-affiliate Glencore Agriculture UK purchase Mercury Commodities, a UK-based animal feed product supplier.