The Colombian conglomerate of packaged food companies Grupo Nutresa recently announced an agreement to acquire Belina Nutrición Animal SA, a Costa Rican pet food manufacturer. The acquisition agreement signified a deal of US$28 million.
According to press sources, Belina sold around US$34 million in pet food and animal feed products in 2020, with 70% of revenues coming from the pet food division. Belina currently has 225 employees in Costa Rica.
Considering the value of sales reported, it is likely that the company’s production capacity of pet food and animal feed ranges around 40,000 metric tons per year. Belina is known for producing and distributing the pet food brands Balance, Superkan and Gourmet Mix.
According to Triplethree estimates, the Costa Rican pet food market is the eighth largest market in Latin America, while Colombia is fourth. This acquisition will likely not affect either pet food market as the agreement does not foresee any expansion capacity in the short term, nor does it modify the structure of the market.
In Central America, Costa Rica is among the largest pet food markets in the region and one with the best prospects as its economy is sounder than others.
Yet, the main reason behind the acquisition may lie with Costa Rica’s geographical proximity to Colombia, plus Costa Rica’s better competitive environment. Unlike other Central American pet food markets, which are more concentrated with just a few multinational brands, the country has more product assortment, meaning less market concentration.
Along with the geographical advantage, the more advantageous competitive situation in Costa Rican allows the Colombian group to enter a relatively mature pet food market and envision growth with less competitive restrictions.
In addition, Grupo Nutresa sells nearly 10.2% of its total sales in Central America. Therefore, with this acquisition, the Colombian group likely strengthens its position in the region while it enters a promising new market.
Iván Franco is the founder of Triplethree International and has collaborated on hundreds of research projects for several consumer goods industries. He was granted the Global Consultant of the Year award by Euromonitor International and authored the book 17 Market Strategies for Growth (in Spanish).
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