The acquisition plans were first made public in January this year, after LSG's founders signed an agreement to sell their shares.
Diversifying its current product range, driving sales growth, promoting cross-selling of BY-HEALTH’s and LSG’s products are the main reasons for the acquisition, the firm said in the announcement.
The acquisition of LSG is also a “key move” for BY-HEALTH’s entry into the global market, BY-HEALTH CEO Lin Zhi Cheng added.
After the acquisition, BY-HEALTH will own LSG completely.
Commenting on the acquisition, managing director of LSG Ben McHarg said in an interview with NutraIngredients-Asia that it would be “business as usual” since he and another founder Craig Silbery would be staying on.
LSG entered China market via cross border e-commerce in the year 2015, selling a range of probiotics products catered to a wide age range, including infants, children, adults, and elderly.
Its operating revenue for last year was 54% more than that of the year 2016.
China’s probiotics market
China contributed nearly half of APAC probiotics sales, amounting to US$8.5bn ($11.8bn).
The value of China’s probiotics market is forecast to double and reach US$15bn (A$20.8bn) by 2025.
Growing consumer awareness of the benefits of probiotics beyond gut and digestive health, are factors fuelling China’s market growth, said George Paraskevakos, executive director at International Probiotics Association (IPA).
“The ageing population, a growing understanding of the importance of preventive health, along with a wealth of studies showing benefits around immunity, cognitive health and skincare, are all helping with this growth,” he said in an interview with NutraIngredients-Asia previously.
Four months ago, BY-HEALTH also announced that it would buy the assets of Penta-vite, a children nutrition supplement brand under Bayer at the price of US$15.1m (A$21m).
Penta-vite, founded in 1940 in Australia, was managed by Roche before Bayer acquired it in 2004.
Craig Silbery who established LSG in 2006 and led the firm’s entry into China, will deliver a keynote address at our Probiota Asia summit next month.
He will discuss the role of Australian manufacturing in the company’s success; and how the rules, regulations and frameworks have helped drive Australia’s reputation for clean and green products.