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M&A Activity in Sustainable Food and Drinks Brands

NEW YORK July 19, 2011

M&A Activity in Sustainable Food and Drinks Brands


Alongside the growing pressure on the leading multinational corporations to adopt ethical codes of practice, there exists a rising consumer demand for sustainable products. Unable to easily develop this organically, major food and drink manufacturers must look to acquire successful sustainable brands in order to gain a stake in this sector. This report analyzes current M&A trends in this industry.

Features and benefits

* Identify the driving forces behind the growth of sustainable brands.

* Examine a regional analysis of global M&A activity in the sustainable brands sector.

* Learn what makes an attractive target for leading food and drinks manufacturers and what features offer the best promise of continued success.

* Understand how a sustainable brand can continue to be successful after being acquired by a large-scale manufacturer.

* Study key examples of industry consolidation in this sector over the past three years.


Sustainable brands attempt to differentiate themselves using their ethical credibility. However, there are limits to the growth of sustainable brands because of restrictions associated with their scale and distribution network. Although deals with larger partners threaten their degree of independence, investment is required for growth.

$15 billion

India China

Your key questions answered

* What are ‘sustainable brands’ and what has been their impact upon the consumer products industry over the past few years?

* Which companies has a history of acquiring sustainable brands and is there any apparent strategic direction in the pattern of acquisitions?

* How can companies learn from the evolution of the sustainability trend and previous M&A activity in this sector?

* Are certain regions more synonomous with this M&A activity than others and what factors are influencing this

* What has been the impact of the global financial crisis on M&A activity in the sustainable brands sector?

Executive Summary


Market dynamics

Pre- & post-merger strategies

Case studies

Future outlook

About the author







Explanation of terms

Growth of sustainable brands

Global connectedness

Consumer awareness

Sustainable entrepreneurs

Sustainability as a marketing tool

Features of sustainable brands

Consumers feel a connection to the brand

Sustainable credentials are fundamentally linked to brand values

Sustainable brands are premium brands – at the moment


Sustainable companies are generally small companies

Sustainable brands – easier to buy than build

Strategic issues

Consumer mistrust

Barriers to developing an authentic brand narrative

Intangible assets

Merger and acquisition activity 2008–2010

Small value transactions are the norm

US companies dominate

Types of acquirer

Large-scale manufacturers

Small- or medium-sized manufacturers

Private equity

Market dynamics



Geographical breakdown of acquiring companies

North America Europe

The US dominates the market, with the UK a distant second

Geographical breakdown of target companies

North American and European companies are the most popular targets

US companies again at the forefront

Deal values

Reported deal values and the average deal size are falling

Significant transactions

Types of transactions

Pre and post merger strategies



Drivers for acquirers

Emerging niches – filling gaps in product portfolio

Achieving scale

Buying innovation and an entrepreneurial approach

Buying expertise and enthusiasm

Access to a sustainable supply chain and contacts

The halo effect

Part of a wider sustainability strategy

Drivers for targets

Growth strategy – diversification of markets

Improving distribution networks

Capital backing for growth

Marketing muscle

What makes an attractive target?

Scalable opportunities

A product that fits the mainstream

A history of strong growth

A defensible position

Ethical credentials

Post merger

An open relationship between the two companies

Keeping key people incentivized post-acquisition

Front-footing criticism

Predicting the future

Acquisition case studies



The Coca-Cola Company

Acquisition of Honest Tea, 2008 and 2011

Acquisition of a stake in Innocent Drinks, 2009 and 2010

The Hain Celestial Group

Acquisitions history

Private equity

Acquisition of Plum Baby by Darwin Private Equity

Investment in O.N.E. Natural Experience by PepsiCo and Catterton Partners

Future outlook



A global focus on sustainability

Limited resources

Development of the middle class

The future of sustainable brands

Market growth will continue

Proliferation of brands in the short-term, fewer in the long-term

Sustainable claims will need to become more specific

Future trends in M&A

Innovative approaches to mergers and integration of acquisitions

More consolidation of brands

Creation of ever-larger conglomerates of sustainable brands

Private equity will remain a significant player





Secondary research


To order this report:

Investment Banking Industry : M&A Activity in Sustainable Food and Drinks Brands

Investment Banking Business News

Market Research Report

Company Profile, SWOT and Revenue Analysis!

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SOURCE Reportlinker

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