Private equity deals dominate food and beverage sector

New analysis from Grant Thornton UK LLP finds that private equity (PE) deal activity dominated the food and beverage sector in 2021, making up over 40% of all deals across the year. This is the highest level of activity seen from PE in the sector for a decade.

This is a significant rise compared to before the pandemic (2019), when PE accounted for 25% of all deals across the year.

The research finds that food and beverage deal activity is on an upward trend, with 37 deals announced in Q4 2021, compared to 32 in Q3, and 33 in Q2. However, these figures remain subdued compared to equivalent pre-pandemic quarters.

Overall, 165 deals took place in the sector last year – a slight uptick compared to the 160 deals recorded in 2020, but not quite meeting the pre-pandemic average of over 200 deals.

Food and beverage deal value dropped in the last quarter of the year totalling just £396.5million, compared to £1.4billion in Q3 (excluding the £10.3billion acquisition of Morrison’s).

While deal value may have dropped in the last quarter, across the year, the sector’s total value of disclosed deals was £23.2 billion. This is almost double the value reached in 2020 (£12.6billion total deal value), but was

inflated by the presence of several mega-deals last year including CVC’s acquisition of Ekaterra BV (£3.8 billion) and PAI Partners acquisition of Pepsico’s Tropicana and Naked brands (£2.4 billion).

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