Food & Beverage M&A Update — Q1 2024
Cocoa futures have doubled since the start of this year. (Photo: Shutterstock)
Tamarack Partners released its Q1 2024 Food & Beverage M&A Update. March’s inflation uptick and strong jobs report suggest the “last mile” of the inflation fight could take longer than expected. Wholesale prices saw the biggest move (2.1% YoY) since April of last year, indicating pipeline pressures that could keep inflation elevated. A bright spot: food prices have come to a standstill. The food index rose 0.1% in March following no change in February and a 0.4% rise in January. We expect the mild rise in food prices to offset some consumer inflationary concerns.
California’s new law raising its minimum wage to $20 per hour for fast-food workers went into effect on April 1. While more than half a million fast-food workers celebrate the hefty pay raise, it may have unintended consequences that could do more harm to these employees, including restaurant closures, job cuts, reduced hours and increased deployment of automation to bring down expenses.
A shortage of cocoa beans has caused major cocoa plants in Côte d’Ivoire and Ghana, the two countries responsible for 60% of global production, to stop or cut processing. With chocolate makers around the world reliant on West Africa for cocoa, there is significant concern about the impact on chocolates prices and farmers’ livelihoods. The decline in cocoa production is due to environmental, economic-cycle related, and human factors.
In early March, the S.E.C. approved new climate rules designed to inform investors of business risks from climate change. The rules were rolled back amid opposition from the G.O.P., fossil fuel producers, farmers and others.
Also included in this report:
M&A commentary by sector and acquirer group
Insight from Tamarack associate Hannah Kessler
Spotlight on notable deals
Listed transactions
Tamarack Partners provides M&A advisory services to owners of lower middle market companies. For more information on this report or to speak with one of our transactional advisors about your business, Contact Us.
