Top Four Trends Driving Mergers and Acquisitions in the Food & Beverage Industry in 2024

In the third video in our new IMAP M&A Industry Insights series, Tom Waslander and Gábor Szendrői take a deep dive into the Food & Beverage Industry and outline the Four Key Trends affecting M&A activity in the sector this year.

They also share a valuation forecast, looking at the key players, valuations, and multiples.

Trend 1. High Inflation, Recession and Cost of Living Driving Companies to Optimize Portfolios

• In uncertain times, large players look at portfolio optimization
• Luxury goods have grown while consumers with lower disposable incomes have struggled forcing companies to adapt portfolios
• Bolt-on acquisitions allow players to enter new segments

Trend 2. ESG Regulation Forcing Move Towards Sustainable Packaging

• Global trend for recyclable and sustainable packaging driving consolidation in Europe. Brazil still in early stages of this new trend

Trend 3. Increasing Consumer Spend on Pet Food

• Continuing growth in Pet Food: variety, availability, and move to processed foot
• Market in Brazil also strong despite pressure on disposable income - many large international players and few local players

Trend 4. Increase in Distressed M&A Opportunities

• Many companies still carrying debt following the pandemic leading to higher number of distressed M&A deals

Valuation Forecast

• While transaction volume dropped in 2023, Food & Beverage was least affected industry
• Valuations expected to stabilize in 2024, and number of transactions in industry expected to increase in Consumer goods
• Multiples in Brazil normally discounted 25-30% vis a vis global multiples
• EBIDTA multiples in Brazil create interesting entry point for multinationals and large nationals to acquire competitors
• Strategics expected to be key players in industry, looking to optimize portfolios, and executing homogenous strategies
• Private Equity expected to be opportunistic while employing cautious buy-side strategies
• In Brazil, strategics are more active than Private Equity likely due to multiples

Tom Waslander

Managing Partner

IMAP Brazil

Gábor Szendrői

Managing Partner

Concorde MB Partners - IMAP Hungary