Danone’s deal worth billions of euros for the meal-replacement brand Huel shows that it is willing to act quickly when it comes fast-growing segments that compliment its core business.
According to Dow Jones, Danone acquired a unique asset in a deal worth EUR1.2 billion: an established global omnichannel nutrition company with strong financial results and room for growth.
Huel is a natural addition to the Essential Dairy & Plant-based Portfolio of this food and beverage giant. But there are also other important factors at play.
Meal replacements, for example, have had a hard time shedding their “unprocessed” image, despite the fact that they are positioned as convenient and complete nutrition solutions.
Danone’s evidence-based approach to health and wellbeing in product development is set to transform this category into one that truly focuses on functional nutrition.
This is the reasoning behind the Danone deal, and the direction that meal replacements may go next.
Danone’s purchase of Huel at a high price
Huel’s performance has improved in every way since its last public accounting.
The UK company, based in London, reported revenue of PS214m ($250m or around 16%). EBITDA was PS18m (+86%) and profit before taxes were PS13.8m (+194%). It also had a strong EBITDA margin at 8.5%.
Huel’s enterprise value is four times higher than its mature competitors in the food and drink industry. This suggests that Danone views the Huel brand as an asset for the long term.
The French multinational is right on this issue, based on a number of factors: the complementary portfolio and the potential market.
Scaling up meal replacements
Alpro will launch Meal to Go by January 2026.
(Danone SA)
Danone has entered the meal-replacement category with its Alpro Meal to Go product, which was released this year in Europe. Danone’s plant-based beverage was marketed as a “nutritionally-complete, ready-to drink meal”. It had essentially formulated an alternative to Huel, though it lacked Huel’s brand power.
Alpro Meal To Go would require significant branding and marketing effort to become a competitor of Huel. This makes the purchase of the major meal replacement all the more attractive.
Meal replacements’ growth runway
According to a Mordor Intelligence study, the meal replacement market will grow 7.46% annually from 2026-2031. The growth is attributed to several long-term trend, including a move towards convenience, health, and wellness.
Huel’s performance on the market is reflected in the broader picture.
A Dow Jones source reported that Huel’s revenue for FY2025 climbed to PS250, up 16% from the previous year. This suggests a growing market demand in a sector it dominates.
Huel’s not only growing, it is expanding
Huel optimized its manufacturing footprint and supply chain by opening a factory in Britain in 2024.
A new facility in Milton Keynes, near London (UK), has been built by the UK-based brand of meal replacements to meet increased demand.
The facility was designed to reduce supply chain risks (Huel had previously used contract manufacturers), and position the brand for growth over the long term.
Huel produces dry ingredients for Europe and the UK in this factory, which can scale up to meet capacity requirements.
A future-proofed production facility can be a valuable asset.
Re-imagining meal replacements
Danone’s purchase of Huel represents not only a move to expand its portfolio, but also a step in reshaping an area with high growth.
Some consumers love meal replacements, while others are put off by their ultra-processed image. Danone’s approach to developing products based on evidence could help ‘clean up’ this category.
Alpro Meal To Go is a good example: it was developed as an alternative to sweet and thick shakes. It was also dubbed “a real meal” for busy consumers.
Huel is on sale now.
Huel, despite its excellent financial performance, is experiencing market challenges, such as increased competition, from competitors like MyProtein and Athletic Greens. Other players include Soylent, Jimmy Joy, Soylent itself, Soylent by Danone, Soylent by Soylent.
The company’s most recent accounts indicate that Huel was preparing to sell.
They hired several nonexecutive directorships for the purpose of overseeing a governance revamp, among them Emma Woods. Emma Woods is a former Wagamama chief executive officer who led the group through the TRG acquisition as well as the COVID phase.
Huel, which did not distribute any dividends in 2024 but instead opted to invest its cash, could command an impressive valuation up to PS1billion based on the revenue multiples that are commonly used to value fast-growing nutritional brands.
Partnering with an international company that could maintain Huel’s dominant position in the market is a smart move.
What is the Akkermansia Company?
Akkermansia Company is a Belgian specialist in biotics, which Danone acquired in June 2025. It was known for developing and discovering the Akkermansia Muciniphila MutT strain that has been clinically proven to support metabolic health, strengthen the intestinal barrier and reduce inflammation. This deal bolstered Danone’s efforts to develop gut-health solutions. It aligned with the Renew strategy, and expanded its scientific capabilities for metabolic nutrition.
This move is also in line with Danone’s positioning and strategy within functional nutrition, which includes solutions backed by science for gut health, plant-based nutrition, medical nutrition, and protein.
The group also has a strong M&A policy: In 2025, Danone will acquire the Akkermansia Company – a specialist in biotic sciences – and Kate Farms – a medical nutrition company specializing in plant-based products.
The group has a purpose-driven approach and is moving away from format-driven products to a nutrition-driven one.
Huel is the newest piece in this puzzle, and will be the most important once the regulatory approval for the transaction has been granted.