Financiers have discovered what the industry knew all along: Economic hard times have not been bad for makers and sellers of wellness products. People are willing to forgo luxuries, even new cars and homes, but not their health. As a result, the supplement industry has weathered the recession much better than automakers and homebuilders. Witness the recent spurt in money-driven deals in the nutraceutical industry:

Vitacost.com Inc. is going public with an offering 11 million shares at $11 to $13 per share. The company will trade on Nasdaq under the symbol VITC. The online retailer and direct marketer of health and wellness products lined up Jefferies & Co. and Oppenheimer to manage the sale. Investment bankers Needham & Co. and Roth Capital Partners are co-managers. How well is Vitacost.com doing? The company said it had about 957,000 active customers as of June 30, up 37 percent from the same time the year before. They made purchases about two to three times per year. Over the last 12 quarters, the average order value ranged from $72 to $77. Vitacost.com had net sales of $143.6 million and net income of $17,407 in the latest quarter.

Quasi-competitor Vitamin Shoppe Inc. has also filed to go public by selling up to $143.75 million of common stock under the symbol VSI on the NYSE.  Underwriters are the well-known J.P.Morgan, Bank of America Merrill Lynch, and Barclays Capital. The company sells more than 8,000 different products at its 425 stores in 37 states and even more items through the Internet and catalogs. Vitamin Shoppe had net sales of $601.5 million in fiscal 2008 versus $436.5 million in fiscal 2005. Retail sales are up over the same time period.

And Herbalife Ltd. (NYSE: HLF) paid $10 million this month for Micelle Laboratories to expand manufacturing capacity. The dealmakers were not announced. Micelle provided contract manufacturing services to Herbalife for 24 years and recently helped develop two Herbalife products, mango-flavored Herbal Aloe Powder and mango-flavored Herbal Aloe Concentrate. None of the 92 full-and part-time workers at Micelle are expected to lose their jobs. Herbalife, a global network marketing company that sells weight-management, nutritional supplements and personal care products, reported smaller profits in the second quarter ended June 30, which management attributed to slower sales and currency fluctuations. Sales quarter over quarter rose 7.7 percent in the United States, 3.2 percent in Mexico and 57.5 percent in China.

So it would seem that nutraceuticals are good for what ails Wall Street: a lack of financing and merger deals. How much busier will the fourth quarter be?

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Included among the predicted trends:

• Fiber (according to National Starch Food Innovation)
• Vitamin K (according to PL Thomas)
• Phytochemicals
• Botanicals

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