Dive Brief:
- Darling Ingredients is splitting off its collagen and gelatin businesses into a new company called Nextida, part of a joint venture with Belgium-based Tessenderlo Group to expand opportunities for food companies to add health attributes to their products.
- Nextida will operate as a joint venture focused on collagen-based health and wellness products. Darling will hold a majority 85% ownership stake in the venture, which is expected to have annual revenue of approximately $1.5 billion.
- Popular in the beauty industry, collagen can help reduce signs of aging and increase muscle mass. The deal, which ultimately combines Darling’s and Tessenderlo’s respective collagen businesses, will close in 2026 subject to regulatory approval.
Dive Insight:
As more consumers see food as medicine, ingredient companies are investing heavily in health solutions that blur the lines between food and pharmaceuticals.
Darling wants to be a leader in the nascent collagen ingredient space. Given its association with the beauty and fitness communities, collagen has the potential to be the next big functional ingredient in food, similar to protein or probiotics.
“We’ve got hundreds of different leads and movements going on right now as people try to figure out where the Nextida product line fits into their world,” Darling CEO Randall Stuewe told investors on a call following the announcement. “Is it at the supplement level? Is it in a sports bar? Is it in a drink?”
Darling is also looking at the potential of collagen as a weight loss ingredient. The company’s Nextida GC targets glucose spikes after meals, encouraging the body to increase natural production of GLP-1, the active ingredient in Ozempic and Wegovy.
Collagen has been “the fastest-growing area of Darling Ingredients’ food segment business over the past several years,” Stuewe said in a statement.
The deal with Tessenderlo will result in a combined capacity of about 200,000 metric tons across 23 facilities in South America, North America, Europe and Asia. It is also expected to boost Darling’s shareholder value, with executives saying that the food segment remains undervalued.
Ingredients companies have reported higher sales of products that are either considered natural or contain some type of health benefit. Archer-Daniels-Midland Co. for example announced it would sell an ingredient to boost sleep, stress and mood as the company sees higher sales in its health and nutrition unit.
