M&A activity increased by over a third in the past year, as food and beverage companies looked for new growth opportunities both at home and in new markets. FoodNavigator-USA looks back at some of the biggest deals of the year.
News of one of the biggest acquisitions of the year came in its opening days, as DuPont said it would acquire Danish food ingredients firm Danisco in a transaction worth about $6.3bn. The final price tag was $6.49bn, after Danisco shareholders held on for a better deal until mid-May.
In late January PepsiCo gained Russian approval for its acquisition of 66% of juice and dairy company Wimm-Bill-Dann for $3.8bn. PepsiCo has said it intends to acquire the remaining shares in the firm to gain full ownership for a total consideration of $5.4bn.
Canadian dairy processor Saputo signed an agreement to acquire DCI Cheese Company in February, to expand its presence in the US specialty cheese sector, in a deal worth $270.5m.
Yeast specialist Ohly, part of the ABF Ingredients group, acquired the specialty savory ingredients company Bakon Yeast Inc. located in Rhinelander, Wisconsin, for an undisclosed sum in early March, and Cargill expanded its brand portfolio in India with the acquisition of the refined sunflower oil brand Sweekar from Mumbai-based consumer goods manufacturer Marico.
In April, Georgia-based bakery giant Flowers Foods snapped up snack cake maker Tasty Baking Company in a $165m deal.
General Mills entered into definitive agreements to acquire a 51 percent controlling interest in French yogurt maker Yoplait and a 50 percent stake in a related entity that holds the global Yoplait brands in May.
General Mills, which has held the license for the Yoplait brand in North America since 1977, won a bidding race with an offer of €810m (about $1.15bn) in March, after private equity firm PAI had put its 50 percent share in the company up for auction last summer – attracting bids from major food industry players, including Nestlé, Bel, Lactalis and The Bright Food Company.
At the end of a quiet summer on the M&A front, Bunge North America acquired the margarine assets of the C.F. Sauer Company in Virginia and Kansas in August, in a move it said could help speed innovation in reduced saturated and trans fat foods, and in September Wild Flavors said it would acquire certain assets of natural mint flavor specialist A.M. Todd Group. Financial details were not disclosed for either deal.
UK- and Ireland-based ingredients, flavors and consumer foods giant Kerry Group struck a $230m deal to acquire Cargill's global flavors business in September, and a month later Synergy expanded its US flavors empire with the acquisition of beverage flavors expert Sethness-Greenleaf less than three weeks after snapping up natural extracts specialist Sensus.
In November, farmer-owned cooperative CHS Inc. signed an agreement to acquire Israeli soy protein company Solbar for $133m.
And earlier this month, The Hershey Company said it would acquire Canadian confectionery firm Brookside Foods for an undisclosed sum.
Finally, one of the biggest deals not to happen in the sector this year was ConAgra’s attempted buy-out of Ralcorp for $94 per share – or about $5.2bn – following the rejection of other, lower bids from the food maker. ConAgra finally withdrew the offer, following what it called “Ralcorp’s failure to enter into a constructive dialogue with ConAgra Foods.”
According to The Food Institute, which tracks M&A activity in the food industry, there were 273 deals in the sector in the first nine months of 2011, up 39.2% on the previous year.