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Michael Poole

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Industry Trends

USDA Invests in Organic Market Expansion

The USDA's allocation of approximately $40.5 million in grants through the Organic Market Development Grant program signifies a substantial investment in the sector. Targeting improved processing capabilities, this funding is set to benefit over 27,000 producers and 31.8 million consumers, supporting the transition to organic production. This initiative reflects a broader trend towards sustainable and organic practices in the food and agriculture industry as companies align with these evolving market demands and opportunities.1

Campbell's Strategic Acquisition Bolsters Market Presence

Campbell Soup Company's acquisition of Sovos Brands for $2.7 billion marks a strategic move in the food and agriculture sector, strengthening its Meals & Beverages portfolio with premium brands like Rao’s, Michael Angelo’s, and noosa. Sovos reported $1 billion in net sales with significant organic growth, reflecting the high potential for these brands within the broader food industry. This move not only diversifies Campbell’s offerings but also positions it for enhanced growth and market presence.2

Growing Investor Interest in the Food and Agriculture Sector

The food and agriculture sector demonstrated its market strength with significant transactions, such as the private equity group Fengate's acquisition of Saco Foods, a provider of shelf-stable food brands. This move, alongside other notable deals, highlights the sector's robust investment appeal and strategic growth. These activities underscore the vitality and potential of the Food and Agriculture Industry, attracting keen interest from investors seeking to capitalize on its dynamic prospects.3

Bolstering Presence in Snacking and Frozen Foods

Leading food corporations, including Mondelēz and General Mills, are actively exploring M&A opportunities in 2024, with a strategic focus on smaller-scale "bolt-on" deals. This approach enables these companies to expand their market presence and product portfolios, particularly in growth areas like snacking and frozen foods. This movement in the food and agriculture sector demonstrates a deliberate strategy where firms are keen on enhancing their product range and extending their market presence.4

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Sovos Brands, Inc.
  • Campbell Soup Company
  • $2,959.52
  • Revela Foods, LLC
  • Archer-Daniels-Midland Company
  • $656.00
  • Ingomar Packing Company LLC
  • Kagome Co., Ltd.
  • $243.34
  • Progressive Produce Corporation
  • PTF Holdings, LLC
  • $120.25
  • Food Wholesale business of YBB TECHNOLOGY INC.
  • Fresh2 Information Inc.
  • $72.15
  • Benson Hill Ingredients, LLC
  • White River Soy Processing, LLC
  • $72.00
  • Devenish Nutrition, LLC
  • Easy Bio USA, Inc.
  • $66.34
  • Non-Core Business Operations in Arizona and Certain Assets in Nevada
  • The Mint Cannabis
  • $29.50
  • Fermented Food Condiment Brands of The J. M. Smucker Company
  • TreeHouse Foods, Inc.
  • $20.00
  • Riley's Pets
  • Pet MD Brands, Inc.
  • $7.50

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • California Custom Fruits & Flavors, Inc.
  • Peak Rock Capital LLC
  • n/a
  • The Wine Group LLC
  • Carbyne Gestão de Recursos LTDA
  • n/a
  • Crest Foods Co, Inc.
  • Harwood Private Equity LLP
  • n/a
  • No Man's Land Foods, LLC
  • Bansk Group LLC
  • n/a
  • Alter Eco Americas Inc.
  • Trek One Capital
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Açaí and Smoothie Bowl Business of SunOpta Inc.
  • Sambazon, Inc.
  • $6.00
  • Tessemae's LLC
  • PANOS brands, LLC
  • $4.5
  • Golden Ridge rice mill located in Wynne Arkansas
  • Ridgefield Rice
  • $2.15
  • Bake Room
  • Methodical Roasting LLC
  • n/a
  • Broiler processing plant, hatchery and feed mill of Tyson Foods, Inc.
  • Cal-Maine Foods, Inc.
  • n/a

 

Source S&P Capital IQ as of 4/16/2024 and PCE Proprietary Data

PCE Transactions

Contacts

David Jasmund

Orlando Office

407-621-2111 |

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Michael Poole

Orlando Office

407-621-2112 |

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Will Stewart

Orlando Office

407-621-2124 |

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Data Assumptions

This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

Glossary

EBIT - Earnings Before Interest and Taxes
EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
LTM - Last Twelve Months
TEV - Total Enterprise Value

Sources:

  1. 1. Calif, A. “USDA Announces $40.5 Million in Grant Awards to Support Processing and Promotion of Domestic Organic Products.” USDA, 14 March, 2024.
  2. 2. Regan, J. “Campbell Completes Acquisition of Sovos Brands, Inc.” Compbell’s, 12 March, 2024.
  3. 3. Vallejo, C. “PE Weekly: Food and Beverage, Infrastructure Lead Dealmaking.” Middle Market Growth, 25 January, 2024.
  4. 4. Doering, C. “Food execs signal a strong appetite for M&A in 2024.” Food Dive, 4 March, 2024.
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