What We're Seeing

Market Update

The food & beverage M&A market remains robust through June driven by several notable transactions. Through June 2018, food & beverage deal volume has totaled $71 billion, putting 2018 on pace to surpass total 2017 volume of $78 billion. Several recent transactions have accelerated 2018’s activity, including JAB Holding Company’s $1,995 million acquisition of sandwich chain Pret A Manger and Kroger’s $700 million acquisition of Relish Labs, a provider of ingredient and recipe delivery services.

What We’ve Been Doing

Closed Harris Williams Transactions

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What We've Been Reading

Food Companies Struggle To Adapt To Quickly Changing Consumer Tastes

Consumers are shifting away from the packaged food staples of prior years in favor of fresher or cleaner-label options. CPG companies are facing increased competition from emerging brands through advertising and e-commerce delivery options that reach niche markets. The decline in sales is due to changing consumer preferences, which indicate shoppers are rejecting processed foods in favor of fresh, clean, and free-from-label options, while smaller startup companies are witnessing high positive growth as they are reaching niche customers through social media.

Access the full article here.

Health Attributes Becoming More Important In The Snacking Space

Consumers continue to shift towards healthier, better tasting snack foods. This has led companies to come up with ideas to add protein and other nutrients in potato chips, cookies, crackers, and even water. The goal is to make these products nutritious and better tasting for consumers. Baby boomers are specific about their health needs, and millennials are becoming more inclined to snack on fresh foods such as fruits and vegetables with crackers in an easy, on-the-go pack.

Access the full article here.

Food Industry Braces For Impact From Trump's Steel And Aluminum Tariffs

The costs of manufacturing foods and beverages packaged in cans made from imported aluminum or steel are projected to increase from the tariffs imposed by the Trump administration. The tariffs also expect to increase the retail price of American canned food and beverage products for consumers in Canada and Mexico. Shares of established players such as Campbell Soup, Tyson, Hormel, and Molson Coors have been tumbling due to the policy change.

Access the full article here.

Vital Signs

Commodity Price Indices4

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Protein Price Indices1,2

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Restaurant And Grocery Store Sales Indices3

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Consumer Food Price Index Inflation1

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Public Equity Market Overview

Key Trading Statistics4

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Public Company Sector Performance (Median One Year Change In Stock Price)4

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Recent Equity Offerings5

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Food And Beverage Industry Stock Performance Index4

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M&A Market Overview

Highlighted Food And Beverage M&A Transactions4

JAB Holding Co Announces To Acquire Pret a Manger

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  • JAB Holding Co agreed to acquire Pret A Manger for $1,995mm.
  • Headquartered in London, Pret A Manger operates sandwich restaurants and provides food delivery services at 530 locations across the world.
  • The acquisition accelerates JAB Holding Co’s growth in the food and beverage space, supplementing recent acquisitions such as Krispy Kreme Doughnuts, Inc. and Keurig Green Mountain, Inc.

 

 

PepsiCo Announces To Acquire Bare Foods

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  • PepsiCo agreed to acquire Bare Foods for $200mm.
  • Based in San Francisco, CA, Bare Foods manufactures and sells organic baked fruit chips.
  • The acquisition enhances PepsiCo’s fruit and vegetable snacks portfolio, and increases its customer base.

 

 

The Kroger Co Announces To Acquire Relish Labs LLC

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  • The Kroger Co agreed to acquire Relish Labs LLC, trading as Home Chef, for $700mm in cash.
  • Based in Chicago, IL, Relish Labs provides ingredient and recipe delivery services.
  • The acquisition will accelerate market growth for The Kroger Co’s meal kit business, complementing its existing Prep+Pared Meal Kit offerings.

 

Food and Beverage M&A Trends4

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Latest Deals and Announced Private Equity Activity4

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Debt Market Overview

Food and Beverage Loan Activity6

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Recent Debt Offerings7

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M&A Overview*

Median LTM Trading Multiples And Quarterly Food And Beverage M&A4

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Recent Food And Beverage M&A4

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Recent Food And Beverage M&A4

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Food And Beverage Earnings Release Calendar

Earnings Release Calendar4

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Public Comparables4

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1.U.S. Bureau of Labor Statistics

2.Unweighted Average

3.US Census Bureau

4.Factset

5.Thomson Financial

6.S&P

7.Reuters