A quick note on a financial deal: British pharmaceutical giant GlaxoSmithKline has bought Maxinutrition, the company behind the Maximuscle brand of diet supplements and energy products. GSK is paying £162 million to acquire the company, roughly US$250 million / €190 million.
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I knew Powerbar had been bought by Swiss food giant Nestlé, a sign that the market had to be big enough to attract a giant company but this confirms just how much money there is in sports nutrition. It’s also interesting to see a pharma company getting involved here, instead of delivering drugs to cure disease and illness. That said GSK already owns brands like Lucozade and Ribena.
The market for energy products and protein supplements is growing rapidly. Whereas once a healthy life meant exercise and a balanced diet, today companies are increasing vaunting the benefits of supplements, energy products and recovery mixes. With more and more people taking up sports this is a big market. It’s not just for endurance athletes and gym bunnies, I’ve also seen office workers snacking on energy bars in order to “stay competitive” in the spreadsheet arena. Yes, I’m serious.
In addition, this is attractive business because the margins can be substantial, as relatively cheap raw ingredients, whether protein or glucose can be transformed into premium products.
I am sceptical about some of the marketing claims these companies can use, it can be excessive. But there’s no doubting it has its uses. Indeed I think sports nutrition is up there with carbon fibre, Lycra, clipless pedals, bar gear shifting and decent helmets as innovations that have made big changes to the sport.