Exits in consumer packaged goods have gone up significantly in the last few years, with CPG corporates topping the acquirer list.
As consumer packaged goods companies continue to rack up more funding in private markets, an increasing number of private CPG companies are seeing exits.
There were more than 165 exits of private CPG companies in 2015, a sharp increase over 2011, when there were less than 50 CPG exits. This year has so far seen a slowdown, but could easily pick up through the rest of the year and remains on track to beat 2014 totals.
Some trends that are driving this uptick are overall consolidation in the industry, and large brands acquiring smaller ones to better position themselves in certain demographics and carve out market share in specific geographies.
We can see some evidence of these trends when we look at the top acquirers of CPG companies. The most active acquirer is Anheuser-Busch (now Anheuser-Busch InBev after the recent merger), which has bought 15 private companies since 2011. Almost all of these were acquisitions of smaller craft breweries.
DS Services of America, a beverage distributor focusing on water, has acquired nearly 10 different smaller water brands since 2011. While the majority of acquirers are larger CPG companies, BBX capital, a holding company, rounded out the bottom of the list.
Equity financing among CPG companies
Most of the companies that are acquired don’t raise equity financing prior to acquisition. Of the more than 560 acquisitions analyzed, only 3% took equity funding prior to being acquired. This is small compared to tech, which saw 25% of companies raise equity financing prior to exit.
*Exit analysis of first exits only
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