Retail M&A robust at 2022's midpoint
As investors wring their hands over the possibility of an economic downturn, retail M&A is surprisingly robust — even surpassing last year's total at this point. There's been about $29 billion in deal value transacted as we near 2022's halfway marker, according to data provided by Refinitiv.
Yes, but: So far, consumer products M&A is down 31.5% year over year with a total deal value of nearly $22 billion.
Why it matters: M&A remains a key tool companies use to refresh their brand portfolios and fortify their technology offerings, or alternatively to unload underperforming assets.
Of note: 2022 started off with a bark when Mars, which makes everything from Snickers candy bars to Pedigree pet food, agreed to buy DTC pet food brand Nom Nom for a reported $1 billion.
- Other headline transactions include South American retailer Cencosud's deal to acquire a 67% stake in grocery chain The Fresh Market at an enterprise value of nearly $1.6 billion.
The intrigue: A number of potential deals are still pending, like the auctions of Walgreens' U.K. pharmacy banner Boots and value-oriented department store chain Kohl's — but some worry macro conditions could derail negotiations.
- If both deals happen, it could lift total retail deal activity by more than $10 billion.