This is an intriguing time to be involved in the global food and beverage industry. 2019 remains promising for M&A opportunities for several reasons. Giant food companies are on a spree to expand their portfolios with food innovation. Food start-ups and smaller private food companies are looking to cash in on growth and exit strategies. And private equity and venture capital firms are motivated to get their piece of the pie.M&A Activity
In 2018, there were 276 M&A deals closed, with nearly 70 percent of deals completed by privately owned buyers. Throughout last year and the first quarter of this year, several high-dollar transactions have taken place:
A slew of various trends are driving the robust activity surrounding the food sector.
There is no ignoring the question of how the ongoing trade war between the United States and China might be impacting the food industry. The overall situation has the potential to influence M&A in this sector. However, the trade war has yet to derail the global economy and M&A activity still faces a positive outlook. Even under a threat of a recession, M&A deals are predicted to hold steady. Private equity firms still have plenty of capital on hand. Interest rates remain low. Big food companies remain focused on investing in growth, and consumers’ eating habits keep changing.
It is important to keep in mind that the overall food industry is composed of many smaller individual sectors, with some being less affected by trade talks than others. For example, the prepared foods business is high margin and less susceptible to commodity swings.
A view of the situation from another perspective indicates that Canada, Mexico, Japan, and countries in the European Union and Southeast Asia could actually be benefiting from the ongoing trade conflict.
Time to Act?
If you are excited to seize the moment in the evolving food & beverage industry, contact us at Benchmark International so that we can put our global connections to work for you.
Americas: Sam Smoot at +1 (813) 898 2350 / Smoot@BenchmarkCorporate.com
Europe: Carl Settle at +44 (0)161 359 4400 / Settle@BenchmarkCorporate.com
Africa: Anthony McCardle at +2721 300 2055 / McCardle@BenchmarkCorporate.com
ABOUT BENCHMARK INTERNATIONAL
Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $5B across 30 industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from 13 offices across the world, have assisted hundreds of owners with achieving their personal objectives and ensuring the continued growth of their businesses.