In the article below, Mark Lynch a founding partner of Food & Beverage Co. M&A specialists Oghma Partners, reviews the outlook for merger and acquisition activity in the UK food & beverage sector in 2009 in contrast to activity in 2007 & 2008. He also assesses the outlook for food company valuations.
Sentiment Stymies Action in the Food & Beverage sector
2008 saw an across the board reduction in M&A activity (by volume) with 71 deals identified in the year vs. 114 in 2007. This roughly one third decline in deals has been caused by, amongst other things; valuation uncertainty prompted by volatile equity markets; a sharp reduction in the availability of finance as crisis hit banks held back on lending and a withdrawal of activity by private equity players.