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M&A half-yearly dealtracker food, beverage & agriculture sectors

Evert Everaarts Evert Everaarts

In our half-yearly dealtracker updates we analyse mergers and acquisitions for the food, beverage and agriculture sectors. We highlight the following aspects of this sectors from an M&A perspective:

  • An overview of the Dutch transactions.
  • A description of what is happening in terms of valuations and number of transactions.
  • A further analysis in terms of geographies and sub-sectors.

2019 1st half year

Answering to increasing conscious consumer demands is the main deal driver in the sector

Within the Food, Beverage & Agriculture sector we observe an increased consumer demand for healthy food products coming from sustainable sources. The importance of brand names and price tags is replaced by telling the right story. In the first half of 2019 we observe this trend of conscious and sustainable innovations as the main driver for companies to be acquisitive. This trend is shown in the acquisition of EAT by Pret A Manger. With the acquisition Pret A Manger wants to offer more vegan and vegetarian options to their customers. Another example is the acquisition of Graze by Unilever, through which Unilever aims to further expand their portfolio of purpose-driven brands.

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2018 4th quarter

Keeping up with latest trends by means of strategic acquisitions

We believe that large and traditional food companies will more often adapt to the latest consumer trends, such as natural, vegan and organic foods by means of strategic acquisitions. This enables them to capture the growing demand for such products while growing inorganically. A good example of this is the acquisition of The Vegetarian butcher by Unilever in Q4 of 2018.

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2018 3rd quarter

Number of deals slightly decreasing but still a key economic sector in Europe

The number of transactions in the European Food, Beverage and Agriculture sector increased significantly the past few years, which seems to be stabilizing, as 2018 shows slightly lower deals and valuations than 2017 Q3. This is no surprise, due to the relatively explosive growth in deals and deal value over the past 5 years.

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2018 2nd quarter

Transaction valuation multiples increasing

European transactions in the above-mentioned sectors stay behind in
the second quarter of 2018. With 126 transactions compared to
160 in Q2 of 2017, we conclude a significant decrease. As earlier
announced, there could be a stabilization in M&A activity after an
active and thriving deal making market in 2016 and 2017. Another
factor that could impact the amount of deals is the current political
environment. Concreteness surrounding the Brexit regulations is still
absent and less than 6 months remain until Britain leaves the
European Union on March 29, 2019. The deal making industry is also
affected by the uncertainties which are sparked by the trade war the
Americans are currently pursuing.

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2018 1st quarter

Transaction valuation multiples increasing

European transactions in the abovementioned sectors stay behind in 2018 Q1, with 147 transactions (2017 Q1: 182). There could be a stabilization in M&A activity due to global (political) uncertainty after an active and buoyant deal making market in 2016.

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If you have any queries related to transaction services, including mergers and acquisitions, company sale, valuation services, transaction due diligence and financing, please contact our M&A advisors.