Food And Beverage M&A Landscape – Spring 2019

Author:Mr Joshua Benn, Howard E. Johnson and Farzad Mukhi
Profession:Duff and Phelps

Mergers & Acquisitions (M&A) deal activity in the food and beverage industry remains strong, with 283 deals closing in the last 12 months (LTM) to March 31, 2019. The market witnessed two major transactions in the first quarter of 2019 - the acquisition of The Schwan Food Company Inc. by CJ Foods America Corp. closed on February 25, 2019, which valued the company at $2.2 billion, and the acquisition of Blommer Chocolate Company by Fuji Oil Holdings Inc. closed on January 1, 2019, with a value of $750 million.

M&A activity in the Food and Beverage industry is still predominately driven by strategic buyers (including companies primarily owned by private equity investors), with strategic transactions representing 91% of total deal flow over the LTM. Of the 283 deals closed in the LTM, 199 (70%) were completed by privately owned buyers.

Overall deal volume in the LTM to March 31, 2019 remained relatively in line with last year, only 5.4% lower than the 299 deals closing over the previous 12-month period.

The beverage sector continues to be an active space for M&A, with 47 transactions completed by alcoholic beverage companies and 40 deals completed by non-alcoholic players in the LTM. Sports nutrition and health-based brands are a key focus area for strategic buyers, reflected by PepsiCo's announced acquisition of CytoSport for $465...

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