Food and Beverage
Food and Beverage
Food and Beverage
Industry Insights

Kroll Investment Banking
SUMMER 2024

Executive Summary
Executive Summary
Executive Summary
Executive Summary
Executive Summary

TTM = Trailing 12 months.

272 food and beverage deals wereannounced in TTM June 2024

88% were completed by privately ownedbuyers

78% were strategic transactions

2

M&A Market Overview
Overview
In Q2 2024, 82 transactions were announced in the food and beverage industry, representing a strong 17% increase in transaction count whencompared with the previous quarter. For the trailing 12 months (TTM) period ending June 30, 2024, 272 deals were announced in the space, marking
an 8% decrease in comparison to the prior TTM period. Although decreasing on a year-over-year basis, the rebound in quarter-over-quarter M&A
activity is encouraging.

Q2 2024 saw many North American deals in the alcoholic beverages and general food spaces. Notable transactions announced within these areas
include Constellation Brands Inc.’s acquisition of Sea Smoke Estate Vineyards and Lassonde Industries Inc.’s impending acquisition of Summer Garden
Food Manufacturing. The alcoholic beverages, bakery, general and protein producers categories were the most active in terms of deal volume,
representing 67% of the total transaction count this quarter.
TTM June 2024 M&A activity in the food and beverage sector remained predominantly driven by strategic buyers (including companies primarilyowned by private equity investors), with strategic transactions representing 78% of total deal volume. Of the 272 deals announced over the TTM
period, 239 (88%) were completed by privately owned buyers.
The sharp ramp-up in Q2 2024 food and beverage deals represents the third consecutive quarterly increase in M&A activity. The increase in deal flow
is likely driven by the significant amounts of cash on the balance sheets of large corporations, creating opportunities for these strategic buyers torealize synergies through M&A. However, despite record levels of dry powder, private equity firms have been slow to enter and exit investments
because of elevated borrowing costs and unmet valuation expectations, shifting the interest of some groups towards smaller strategic add-on
acquisitions and the use of more flexible private credit financing.
Although inflation rates have stabilized, retail prices of food and beverage products remain high, and companies will need to continue being mindfulof changing consumer preferences, away from high quality to best value. As the market prepares for further Canadian interest rate cuts and initial
cuts in the U.S., we expect food and beverage M&A activity to remain strong in the back half of 2024.

Sources: Reuters, S&P Capital IQ, Statista.
Note: M&A deal count is defined by a list of subsectors viewed as the best representation of the industry.

3M&A Market Overview—Cont’d
Number of Announced Deals (as of June 30, 2024)

99

By Number of Announced Deals(TTM as of June 30, 2024)
99

94

92

87

80

939785

85

7989
8284
71

68

65

82
73

Strategic
78%

70
62

58

56

Strategic vs.
Financial
Buyer

62

Financial
22%

Private88%

Private vs.
Public
Buyer
Q3

Q4

2018

Q1

Q2

Q3

2019

Q4

Q1

Q2

Q3

2020

Q4

Q1

Q2

Q32021Q4Q1Q2Q32022Q4Q1Q2Q32023

Note: Includes food and beverage sector deals where the target was based in the U.S. or Canada. Strategic buyers include private equity–backed strategics.
Source: S&P Capital IQ. Transactions with more than 50% of the company acquired are included in the analysis.

Q4Q1

Q2

2024

Public12%4

Select Recent Transactions1
BlueTriton Brands and Primo Water Corporation
Agreed to Merge

Tate & Lyle plc Agreed to Acquire
CP Kelco

On June 17, 2024, BlueTriton Brands and Primo Water Corporation (TSX:PRMW)
announced that the two companies will combine to create a leading healthy hydrationcompany, with Primo Water’s valuation implied at $4.7 billion. “The combinedcompany will benefit from a diversified portfolio of iconic brands, a national footprint
and the strength of the combined delivery platform to better serve customers
anywhere and anyway they hydrate,” said Robbert Rietbroek, Chief Executive Officerof Primo Water.

On June 20, 2024, Tate & Lyle plc (LSE:TATE) announced that it has entered into a
definitive agreement to acquire CP Kelco, a leading ingredient solutions company, andits subsidiaries from J.M. Huber Corporation for $1.9 billion, including deferredconsideration. “With our complementary portfolio and deep technical expertise, wewill bring new value to our customers and new opportunities for our employees. Thisis an exciting time for our combined businesses,” said Didier Viala, President of CPKelco.

Glanbia plc Successfully Acquired
Flavor Producers LLC

Lassonde Industries Inc. Agreed to Acquire
Summer Garden Food Manufacturing

On April 26, 2024, Glanbia plc (ISE:GL9) completed the acquisition of Flavor
Producers LLC, a manufacturer of organic, natural and plant-based flavors andextracts, for $355 million, including an earnout conditional on 2024 performance.
“Our combined capabilities will make us an industry-leading innovation partner for
our valued customers. With this great team, we look forward to an exciting future
ahead,” said Michael O’Neill, CEO of Flavor Producers.

On June 21, 2024, Lassonde Industries Inc. (TSX:LAS.A) signed a definitive agreement
to acquire Summer Garden Food Manufacturing, a producer of sauces, condiments anddressings, for $280 million. “This partnership ensures our legacy will continue tothrive,” said Thomas Zidian, President and Chief Executive Officer of Summer Garden.
"We are confident it will benefit our customers through enhanced products and willoffer our employees new opportunities for development and advancement.”

The Simply Good Foods Company Acquired
Only What You Need Inc.

Constellation Brands Inc. Acquired
Sea Smoke Estate Vineyards

On June 13, 2024, The Simply Good Foods Company (NasdaqCM:SMPL) completed
the acquisition of Only What You Need Inc. (dba: OWYN), a producer of plant-based
ready-to-drink protein shakes, previously owned by Purchase Capital, for $280
million. “This transaction will enable OWYN to leverage Simply Good Foods’ sales,marketing and go-to-market capabilities and positions the brand to reach the nextlevel of growth,” said Nicholas J. Singer, Founder and Managing Partner of Purchase
Capital.

On June 30, 2024, Constellation Brands Inc. (NYSE:STZ) acquired Sea Smoke Estate
Vineyards, a California-based producer of high-quality wines, for $170 million. “Weare extremely excited to collaborate with Constellation Brands as we begin writing anew chapter in the Sea Smoke story. They have the right team with the right resources
and the expertise to help us grow and thrive in a highly competitive market,” said
Victor Gallegos, VP/GM and Director of Winemaking at Sea Smoke.

1 Deals in the U.S. and Canada, closed or announced over Q2 2024, selected subjectively based on being representative of recent market activity. All figures are denoted in US$.

Sources: S&P Capital IQ, Mergermarket, company press releases and various news sources (e.g., Newswire).
Note: All trademarks, trade names or logos referenced herein are the property of their respective owners.

5Recent North American M&A Activity by Subsector
Food and Beverage Subsector Definitions

Deals by Subsector (TTM as of June 30, 2024)

Bakery:Production and distribution of baked goods
Better-for-You:
Differentiated food products with health benefits

Food

Confectionery/Snacks:
Chocolate, candy, nuts and other convenient snack foods
Dairy:
Production and distribution of dairy or dairy by-products, suchas cheese or yogurt
General:Conglomerates and general food businesses

Ingredients:
Goods used in the production of other food-related items
Produce:Fresh produce or other agricultural productsProtein Producers:
Meat and seafood producers and distributors

Beverages

Specialty-Pet:
Producers of pet food and treats

Alcoholic Beverages:
Wine, beer and spirits
Nonalcoholic Beverages:
Beverages that do not contain alcohol

Produce
7%

Ingredients6%

Confectionery/
Snacks6%

Bakery8%Nonalcoholic
Beverages
8%

Protein Producers
12%

Specialty-Pet
3%

Alcoholic
Beverages
25%

Better-for-You
9%
Dairy
3%

General13%

TTM = Trailing 12 months.

6Select Kroll Investment Banking Food and Beverage Experience
SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

BUY-SIDE ADVISORFINANCIAL ADVISOR

SELL-SIDE ADVISOR

Gum Products International

has acquired certain
assets ofhas been acquired byhas been acquired by

has acquired

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

has been acquired byhas been acquired byhas been acquired by

SELL-SIDE ADVISOR

BUY-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

has been acquired by

has acquired

has been acquired byhas been acquired byhas secured senior debt
financing from a
consortium of lenders

has been acquired byhas been acquired byhas been acquired byhas been acquired bya portfolio company of

SELL-SIDE ADVISOR

a portfolio company of

have been acquired by

SELL-SIDE ADVISOR

a division ofhas been acquired by

Note: All trademarks, trade names or logos referenced herein are the property of their respective owners.

7Select Kroll Investment Banking Food and Beverage Experience
SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

a portfolio company ofhas been acquired byhas been acquired byhas been acquired by

SELL-SIDE ADVISOR

has been acquired byhas been acquired byhas been acquired bya portfolio company of

FINANCIAL ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

BUY-SIDE ADVISOR

SELL-SIDE ADVISOR

BUY-SIDE ADVISOR

has been acquired byhas been acquired byhas been acquired by

has acquired

has been acquired by

has acquired

FINANCIAL ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

BUY-SIDE ADVISOR

has been acquired byhas been acquired byhas been acquired byhas acquired

has merged withhas acquireda portfolio company ofNote: All trademarks, trade names or logos referenced herein are the property of their respective owners.

8Select Kroll Investment Banking Food and Beverage Experience
FINANCIAL ADVISOR

SELL-SIDE ADVISOR

SELL-SIDE ADVISORFINANCIAL ADVISOR

has been acquired byhas been acquired byhas been acquired byhas been acquired by

SELL-SIDE ADVISOR

SELL-SIDE ADVISOR

has acquired
has sold certain assets toa portfolio company ofSELL-SIDE ADVISOR

SELL-SIDE ADVISOR

TRANSACTION ADVISORYSOLVENCY OPINION

TRANSACTION ADVISORYESOP ADVISORY
Cargill, Incorporated

has been acquired byhas been acquired byhas been acquired byhas been acquired byhas completed the spinoff of
Performed financial and tax
due diligence on behalf of theBuyer

Performed financial and tax
due diligence on behalf of theBuyer

SOLVENCY OPINIONSOLVENCY OPINION

FAIRNESS OPINION(nka)

has completed the sale ofhas completed thespinoff of

FAIRNESS OPINIONSOLVENCY OPINION

has been acquired byhas been acquired by

Note: All trademarks, trade names or logos referenced herein are the property of their respective owners.

Financial advisor to the boardof managers of The Bardstown
Bourbon Company LLC

Financial advisor to the trusteesof Cargill, Incorporated
Employee Stock Ownership Plan(ESOP)

TRANSACTION ADVISORY

has been acquired by
Food Technology and Design,
LLC (dba FoodPharma) has
completed a recapitalizationtransaction

Performed financial and tax
due diligence on behalf of theBuyer

9For more information, please contact:
Joshua Benn

Dr. Howard E. Johnson

Farzad Mukhi

Vijay Sampath

Global Head of Consumer, Food &Restaurant Investment Banking

Managing Director, Head ofCanadian M&A

Managing Director, Consumer, Food &Restaurant Investment Banking

Managing Director, Consumer, Food &Restaurant Investment Banking

New York

TorontoLos Angeles

New York+1 212-450-2840+1 416-597-4500+1 424-249-1661+1 212-871-0316

joshua.benn@kroll.com

howard.johnson@kroll.com

farzad.mukhi@kroll.com

vijay.sampath@kroll.com

Mark Kramer

Jake Newman

Stephanie Lau

Jennifer TerrellManaging Director, Transaction
Advisory Services

Vice President, M&A Advisory

Director, Canadian M&A Advisory

ChicagoTorontoTorontoDirector, Fairness and Solvency
Opinions+1 416-813-4472+1 416-361-6761

jake.newman@kroll.com

stephanie.lau@kroll.com+1 302-697-4522
mark.kramer@kroll.com

Chicago+1 302-980-9650
jennifer.terrell@kroll.com

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