Limburg-based Damhert invests in tagatose production

The Limburg food concern Damhert is going to produce the alternative sweetener, tagatose, for yoghurt manufacturer Yoplait and soft drinks giant PepsiCo. Damhert, which specializes in organic food production, is part of the Limburg-based Biofood Invest owned by the Remen family from Limburg. Convinced of its merits, managing director Grete Remen obtained a licence to manufacture the tagatose found in dairy products five years ago. Tagatose is almost as sweet as ordinary sugar, but contains a third of the calories. From the word go Coco-Cola and PepsiCo were keen to use this alternative sugar for their beverages, but, says Remen, “We weren’t geared to start immediately, so we stalled”. But now, with the leverage they are to receive from the AIF fund owned by venture capital fund Gimv and the farmers’ association Boerenbond and investments from the Limburg Reconversion Company LRM, they are ready to start production. The deal must still be formally signed, but the stakeholders have committed to invest 6 to 7 million of the 10 million they had initially hoped to receive. Once the deal is clinched within the next few weeks, Damhert hope to increase production at their Italian factory, where the tagatose is extracted from mozzarella cheese waste products via an enzymatic process. For the second phase of production, which will take place in Belgium, a factory must still be set up. Negotiations are currently underway. At present the company produces in the region of 500 to 700 tons of tagatose, but this will increase to 2,500 tons to meet the orders of PepsiCo and Yoplait, and to as much as 10,000 tons within the next few years. “We would like to keep all our activities in Belgium. To this end we hope to attract Belgian investors. As a Limburg family business it’s important to strengthen our local base,” Remen stresses. PepsiCo plans to process the tagatose for use in a number of their healty soft drinks while French dairy giant Yoplait intends to use it in its dairy products. Reluctance by investors so far is mainly due to competition from the natural sugar substitute stevia, used amongst others by Coca-Cola. PepsiCo, finding stevia’s taste too much liked liquorice, preferred the taste of tagatose. Some of Damhert’s chocolates, jams and confectionery products already contain tagatose, while the production of chocolate pudding and mousse in partnership with the Limburg-based dairy company Limelco is in the pipeline.