PAI Partners' Acquistion of Innovad Group
- Feb 13
- 6 min read
By Alvaro Aguilar De Nalda and Giuseppe Leonardo Mazza (ESADE); Diana Usova and Oliver Cedar (Bristol University)
Photo: Adi Goldstein (Unsplash)
Overview of the deal
Acquirer: PAI Partners
Target: Innovad Group
Implied Equity Value: N/A
Total Transaction Size: N/A
Closing Date: Expected 1Q-2026
Target Advisor: N/A
Acquirer Advisor: N/A
PAI Partners’ acquisition of Innovad Group represents a notable transaction in the global animal health and nutrition space, taking a rapidly growing specialty animal feed additives platform into the portfolio of a large-cap European private equity sponsor at an undisclosed but likely substantial premium. The deal will be executed via a definitive agreement under which PAI acquires Innovad from IK Partners’ IK IX Fund, with Innovad’s management team, led by CEO Ben Letor, reinvesting alongside the new owner post completion. Innovad is expected to continue operating with a growth-oriented capital structure, supporting ongoing investment in innovation, international expansion, and bolt-on acquisitions in a sector characterised by significant regulatory requirements and rising customer demands. Regulatory scrutiny will focus primarily on competition in specialty additives and compliance with animal health, food safety, and environmental rules, adding execution risk but within a familiar framework for both sponsor and target.
The acquirer sees long-term value in Innovad’s global customer base, diversified portfolio of specialty feed additives, and exposure to structural trends in sustainable livestock production, where demand for science-backed, natural, and plant-based solutions continues to outpace traditional inputs. The transaction positions PAI Partners to drive improvements in commercial reach, operational efficiency, and innovation velocity across Innovad’s platform, while pre-empting competitive sponsor interest amid increasing consolidation in animal nutrition and agri-inputs.
For Innovad, private ownership under a new financial sponsor provides continued strategic support to accelerate its transformation from a regional premix supplier into a global functional feed additives champion. Freed from prior fund ownership constraints and supported by PAI’s larger capital base, the company can intensify investments in R&D, biomonitoring technologies, and sustainability-focused product development, enabling more flexible capital allocation and a bolder M&A agenda than would have been feasible under its previous ownership cycle.
Company Details (Acquirer - PAI Partners)
PAI Partners is one of Europe’s leading private equity firms, investing in mid- to large-cap companies across the food & consumer, business services, healthcare, and industrial sectors. The firm manages over €26 billion in assets and focuses on partnering with management teams to deliver operational transformation, international expansion, and buy-and-build strategies.
Founded: 1872 (origins within Paribas; independent since late 1990s)
Headquartered: Paris, France
CEO: Michel Paris
Number of employees: ~200
AUM*: ~€26 billion
Latest Flagship Fund*: PAI Partners VIII – c. €7.1 billion of commitments
Portfolio Companies*: 40+ companies with a global footprint across Europe and North America
*As of 01/01/2026
Company Details (Target - Innovad Group)
Innovad Group is a global specialty animal feed additives player, providing animal health and nutrition solutions that support performance, welfare, and sustainability across the livestock sector. The company offers a broad portfolio of functional feed additives and natural, plant-based products focused on gut health, mycotoxin risk management, nutrient efficiency, and emission reduction.
Founded: 2014
Headquartered: California, USA
CEO: Jay Kreps, Jun Rao and Neha Narkhede
Number of employees: 3,263
Global Footprint*: Serves 900+ customers across 70–75 countries, with production and innovation centers in Europe and commercial presence spanning EMEA, Asia, and the Americas
Ownership (pre-transaction): IK Partners (IK IX Fund) and managementRecent
Transactions / Initiatives*: Transformation into a global producer of functional feed additives via strategic acquisitions, including the integration of Herbonis’ natural additive portfolio, expansion of plant-based and sustainable solutions, and rollout of biomonitoring and data-driven tools to support on-farm decision-making.
*As of 28/12/2025
Projections and Assumptions
Short-Term Consequences
The deal’s closure in Q1 this year represents a crucial inflection point for the Innovad Group. Following four years of IK Partners’ ownership, the group’s Board of Directors and strategic direction are now under the control of PAI Partners, with oversight from d’Engremont and Gautier, renowned experts in food ingredients and animal nutrition. However, this ownership shift is not considered turbulent, given that the group’s CEO and key executives reinvested their owned capital alongside PAI Partners. This structure, referred to as “management rollover”, consists of executives retaining stakes from the IK’s ownership period and committing their personal capital to PAI’s new ownership. This is fundamental in demonstrating alignment on value creation targets and expectations, as the executives’ personal finances are tied to Innovad’s success.
Complete alignment does not imply a lenient or unchanged strategy. PAI’s investment thesis is significantly more aggressive. PAI’s objective focuses on transforming Innovad into the market leader to subsequently attract strong premiums at exit; a completely different approach compared to IK’s more conservative strategy of solidifying market position. This means Innovad will now focus on faster geographic expansion, aggressive M&A, and overall higher growth targets, with double digits as the baseline, given IK’s current achievements.
Long-Term Upsides
The long-term upside of PAI Partners’ acquisition of Innovad lies in the opportunity to scale a well-positioned platform within the structurally attractive specialty animal feed additives market. Demand for animal health and nutrition solutions is expected to grow steadily as global protein consumption rises and farmers face increasing pressure to improve productivity while reducing antibiotic use and environmental impact. Innovad’s focus on high-value applications such as gut health, immunity enhancement and mycotoxin management aligns closely with these long-term industry trends, supporting resilient demand and pricing power. With an established global footprint across 75 countries and a diversified customer base, Innovad provides PAI with a strong foundation to drive sustained organic growth.
Under PAI’s ownership, Innovad is well placed to accelerate innovation and expand its solutions-driven offering. PAI’s experience in scaling food, ingredients and animal nutrition businesses can support increased investment in R&D, further development of biomonitoring tools, and the expansion of plant-based and bio-circular additives that respond to tightening regulation and sustainability requirements. In addition, the platform offers clear scope for value-accretive bolt-on acquisitions, particularly in adjacent specialty segments and underserved geographies, building on Innovad’s successful M&A track record under IK Partners.
Over the long term, this combination could transform Innovad from a fast-growing challenger into a global leader in specialty feed additives. By deepening customer relationships, broadening its product portfolio and leveraging PAI’s capital and operational expertise, Innovad can enhance margins, strengthen its competitive moat and position itself as a key enabler of safer, more sustainable livestock production, ultimately creating a compelling exit opportunity for PAI.
Risks and Uncertainties
PAI Partners aim to grow Innovad through organic expansion and strategic acquisition, giving the group the best chance possible of continued success. This strategy could bring potential risks that are inherently challenging whenever new acquisitions occur. The structural synergy could prove troublesome, especially as Innovad begins its transfer of ownership to a different private equity firm. While IK Partners will stay re-invested and involved, the transfer to another private equity group, brings pressure on performance expectations. This could give rise to uncertainty in company governance, as the priorities of Innovad and PAI could become estranged, especially regarding long-term decision making.
Another risk that Innovad faces, is in fact its own success. Since its ownership under IK Partners in 2021, Innovad has produced double digit revenue growth. While impressive, this consistent growth could give rise to questions surrounding Innovad's additional innovative capacity, especially after its expansion into primary ingredients and toxin control tools.
Moreover, Innovad's global business model gives rise to global uncertainty risks. Innovad operates across 75 countries, with six production facilities across Europe and Brazil. While Innovad are already prone to the regulatory nature of animal health and feed additives, they could start to become vulnerable to the current geopolitical tensions. With a formal presence in the United States since 2013, Innovad could be affected by recent tariff warfare, which has been a prominent theme during President Trump's second term in the White House.
“We are delighted to partner with Ben Letor and the Innovad management team to support the Group in its next phase of growth. Innovad has established itself as a fast-growing, global challenger in specialty animal feed additives – we look forward to accelerating this transformation, drawing on our significant experience in establishing Food & Consumer businesses as global leaders, particularly in the ingredients and animal nutrition space, where we have a proven track record.” - (Gaëlle d’Engremont and Julie Gautier, Partners at PAI Partners)