02 November 2023
567 deals completed in Q3 2023, compared with 673 the previous quarter. There were 476 trade deals, compared with 559 transactions in Q2, representing a decline of 15%. Private equity deals saw a slightly steeper decline of 18%, with 91 completions, compared with 111 deals in Q2.
Food and Drink sector deal volumes fell by 30% in the opening half of 2023, compared to 2022 H2. Rising inflation and interest rates, coupled with geopolitical uncertainty, worked to erode confidence, damping down the M&A activity that had gripped the UK market post COVID-19. Notably, UK food and drink inflation increased at its fastest pace for over 40 years to reach an eye-watering 19.1% in the 12 months to March 2023. We discuss what’s driving M&A in the Food and Drink sector.
Each quarter we collect data surrounding Enterprise Value (EV) to Earnings Before Interest Tax Depreciation and Amortisation (EBITDA) multiples. The Index tracks the EV to EBITDA multiples paid by trade and private equity buyers when purchasing UK private companies.
We examine this market data and compare it with historic data to identify key trends. We draw on our long experience of running the PCPI and our sector-specific expertise to predict future market trends.