GCG’s Q4 2021 Food & Beverage Industry Update provides an overview of the latest trends in the sector, including recent performance, valuation multiples, and the state of the middle-market M&A environment.
Key findings include the following:
- Q4 2021 saw notable gains in the Food & Beverage (“F&B”) industry and the broader U.S. equity market as equities tested all-time highs despite increasing inflation concerns. The Food Retailers segment was the strongest performing in Q4 2021. The F&B industry continues to lag the broader market as companies battle challenges such as supply chain shortages and staffing issues.
- In Q4 2021, the F&B sector saw an increase in transaction volume from Q3 2021. The F&B sector also saw a slight increase in average deal value, rising to $63.1 million during the quarter. Strategic buyers continue to represent the largest portion of acquirers, accounting for 79.8% of transaction volume. However, private equity funds continue to be active in the space with record levels of dry powder coupled with a low interest rate environment.
- The Packaged Foods and Meats category led activity, accounting for 34.8% of total F&B transaction volume. Restaurant companies proved to be attractive targets as well, comprising 28.5% of transaction volume.
- Based on a representative set of publicly traded companies across the F&B industry, public companies in F&B traded at an average multiple of 16.7x EBITDA and 2.9x Revenue. The strongest trading multiples were observed in the Beverage and Restaurant sectors
Click here for the full update.