United States

Foreign troubles hit U.S. consumer products industry

Q2 2016 consumer products industry spotlight

INSIGHT ARTICLE  | 

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While consumer products businesses may not have control over the global macro environment, those willing to invest in the sales drivers the changing consumer has shown are effective, in addition to actively managing financial and currency risks in a slow- growth environment, will be able to outperform. Valuations remain expensive on the M&A front, but concepts and brands that are able to outpace GDP will serve as attractive acquisition targets. This is especially the case in an environment where strategic acquirers are looking to find more transformational and accretive deals that can move revenue growth higher in a shorter time frame.

Key highlights from the first quarter:

  • There was $54.3 billion in total deal value closed across 410 transactions, representing a rather impressive 71 percent increase in total M&A value in the sector, yet a 14 percent drop in total counts.
  • Underpinned by the $14 billion take-private of Keurig Green Mountain, total private equity deal value moved higher during the first quarter, with volume continuing to slide on a quarterly basis. Nearly $36 billion was invested by private equity deal-makers across 154 consumer-based deals, representing a quarter-on-quarter rise in deal value of more than 28 percent and a decline of 9 percent in terms of volume during the same period

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