January, 2016

Food and Beverage (“F&B”) M&A continues to see strong activity. 2015 had a transaction volume of 351 deals is above 2014 record levels, 333 deals in 2014. For 2015, strategic buyers accounted for 87% of F&B M&A transactions. During 2014, strategic buyers accounted for just over 91% of the transactions.

F&B transaction valuation trends are near historical highs. In 2015, F&B multiples were approximately 13.4x EBITDA and 1.8x revenue. Many F&B categories continue to outperform the S&P 500.

Notable publicly announced 2015 M&A transactions:

– Sazerac Company, Inc. entered into an agreement to acquire the Southern Comfort and Tuaca brands from Brown-Forman Corporation for approximately $544 million.

– Acorn Holdings B.V. entered into a definitive merger agreement to acquire Keurig Green Mountain, Inc. for approximately $14.3 billion. The transaction is expected to close during the first quarter of 2016.

– Pinnacle Foods Inc. entered into a definitive agreement to acquire Boulder Brands, Inc. for approximately $991 million.

– Molson Coors Brewing Company entered into a definitive agreement to acquire MillerCoors LLC for $12 billion.

– The Kroger Co. entered into a definitive agreement to acquire Roundy’s, Inc. for $835 million.

January, 2016

In 2015, strategic buyers accounted for 80% of restaurant M&A transactions. During 2014, strategic buyers accounted for just over 81% of the transactions.

For announced transactions, restaurant multiples saw a modest increase from 10.11x EBITDA and 0.86x revenue in 2014 to 10.13x EBITDA and 1.03x revenue in 2015.

– Notable publicly announced 2015 M&A transactions:

– Brinker International, Inc. entered into a definitive agreement to acquire Pepper Dining, Inc. for approximately $106 million.

– McCormick & Company, Incorporated signed a definitive agreement to acquire One World Foods, Inc. for approximately $100 million.

– NRD Capital Management signed a definitive agreement to acquire Frisch’s Restaurants, Inc. for approximately $177 million.

– Levy Acquisition Corp. entered into a definitive agreement to acquire Del Taco Holdings, Inc. for $500 million.

– AMC Wings, Inc. entered into a definitive agreement to acquire A Sure Wing, L.L.C. for $54 million.

Notable 2015 IPO’s include: Shake Shack, Wingstop and Bojangles.

January, 2016

For 2015, strategic buyers accounted for 88% of Pet Industry M&A transactions. During 2014, strategic buyers accounted for just over 84% of the transactions.

Notable recent M&A transactions:

– CVC Capital Partners Limited and Canada Pension Plan Investment Board signed a definitive agreement to acquire PETCO Animal Supplies, Inc. for approximately $4.6 billion.

– Central Garden & Pet Company entered into an asset purchase agreement to acquire Dallas Manufacturing Company, Inc. for approximately $61 million.

– Patterson Companies, Inc. acquired Animal Health International, Inc. for approximately $1.1 billion.

– Renovo Capital and Summit Investment Management entered into an asset purchase agreement to acquire Dallas Manufacturing Company for approximately $37 million.

– Outward Hound, a Riverside portfolio Company, acquired Petstages, Inc. for an undisclosed amount.

– Outward Hound, a Riverside portfolio Company, acquired Bionic for an undisclosed amount.

December, 2015

Stock price performance and valuation trends have been strong across most sectors. The following is an overview of the selected industries and their respective stock price performance over the last three years and current valuation levels [(Relative Stock Price) (Enterprise Value to EBITDA)].

For year-to-date 2015, strategic buyers accounted for 84% of Consumer & Retail M&A transactions. During 2014, strategic buyers accounted for 84% of the transactions as well.
For reported closed transactions, Consumer & Retail transaction multiples have been in the 10x – 12x range since 2010.

Select recent notable publicly announced M&A transactions:

– Interval Leisure Group, Inc. signed a definitive agreement to acquire Starwood Vacation Ownership, Inc. for $1.7 billion.
– Mattress Firm entered into a agreement to acquire Sleepy’s, LLC for approximately $780 million.
– Hotel Shilla Co. signed a definitive agreement to acquire DFASS Group for approximately $105 million.
– Westport Innovations, Inc. entered into a merger agreement to acquire Fuel Systems Solutions, Inc. for approximately $136 million.
– QVC, Inc. signed a definitive agreement to acquire Zulily, LLC for approximately $2.5 billion.
– Perceva Capital offered to acquire Vanity Fair Brands, LP from Fruit of the Loom for an undisclosed amount.

Notable IPO’s include Etsy, Bojangles, MCBC Holdings, Fogo de Chao, Planet Fitness and Wingstop.

November, 2015

Stock price performance and valuation trends have been strong across most sectors. The following is an overview of the selected industries and their respective stock price performance over the last three years and current valuation levels [(Relative Stock Price) (Enterprise Value to EBITDA)]

For year-to-date 2015, strategic buyers accounted for 91% of industrial manufacturing M&A transactions During 2014, strategic buyers accounted for just over 85% of the transactions.
For closed transactions, industrial manufacturing transaction multiples increased from 8.4x EBITDA and 1.3x revenue in 2014 to 12.1x EBITDA and 1.1x revenue year-to-date in 2015.

Notable publicly announced 2015 M&A transactions:
– Lockheed Martin Corporation entered into a definitive agreement to acquire Sikorsky Aircraft Corporation for $9.0 billion
– BorgWarner, Inc. entered into a definitive agreement to acquire Remy International, Inc. for approximately $1.3 billion
– SCA Americas, Inc. signed a definitive merger agreement to acquire Wausau Paper Corporation for approximately $693 million
– Westport Innovations, Inc. entered into a merger agreement to acquire Fuel Systems Solutions, Inc. for approximately $136 million
– Handy & Harman Ltd. made an offer to acquire SL Industries, Inc. for approximately $180 million

Notable IPO’s include TransUnion, Milacron Holdings Corporation, Blue Bird Corporation and Sunrun, Inc.

October, 2015

Food and Beverage (“F&B”) M&A continues to see strong activity. Year-to-date 2015 transaction volume of 190 deals is just below pace of 2014 record levels.

For year-to-date 2015, strategic buyers accounted for 86% of F&B M&A transactions. During 2014, strategic buyers accounted for just over 91% of the transactions.

F & B transaction activity has been strong, with valuation trends near historical highs. YTD 2015, F&B multiples were approximately 10.4x EBITDA and 1.6x revenue.

Many F&B categories continue to outperform the S&P 500.

Notable publicly announced 2015 M&A transactions:

– B&G Foods North America, Inc. entered into a definitive agreement to acquire General Mills, Inc., Green Giant and Le Sueur Stable and Frozen Vegetable Business for approximately $765 million.

– Swift Pork Co. signed a definitive agreement to acquire Cargill Pork, LLC for approximately $1.45 billion.

– The Kraft Heinz Company signed a definitive agreement to acquire Kraft Foods Group, Inc. for approximately $55 billion.

-Hormel Foods Corporation entered into a definitive agreement to acquire Applegate Farms LLC for $775 million.

– Post Holdings, Inc. entered into a definitive agreement to acquire MOM Brands Company for $1.15 billion.

Notable IPO’s include: Albertson’s, WhiteWave Foods, Wayne Farms, Pinnacle Foods and Eastside Distilling.