UK Food and Beverage M&A activity remained resilient in 2025
29/01/2026 Oghma Partners LLP
- Overall 2025 deal activity: 133 transactions (-12% vs 2024); aggregate value ~£2,500m (-9% vs 2024, excluding £1.5bn Bakkavor acquisition).
- Q3 2025: 39 deals (-33.9% YoY); deal value ~£540m, broadly stable vs £612m in Q3 2024.
- Deal size trends: 65.4% of deals ≤£10m (down from 68.9% in 2024); 12% >£50m (up from 9%, in line with 5-year average).
- Buyer mix: UK corporates 60.9% (-slight YoY); financial buyers 18.2% (up from 12.6%); overseas acquirers 21% (below 5-year average 27.4%).
- sector focus: Beverages 26.3% of deals; major consolidation in chilled foods, led by Greencore’s Bakkavor acquisition (£1.5bn, 7.9x EV/EBITDA).
- UK meat sector: Multiple consolidations (e.g., OSI/Karnova, Cranswick/JamesT Blakeman £32m, Sysco/Fairfax £54m); driven by cost pressures and 16% meat price rise.
- Outlook for 2026: Continued subsector consolidation; selective, strategic M&A; cautious consumer and geopolitical risks may limit activity; deal values/volumes expected broadly in line with 2025.
Mark Lynch, Partner at Oghma Partners, said: “2025 has once again been characterised by geopolitical uncertainty, yet M&A activity in the UK has remained resilient, supported by the gradual recovery of the economy. Since August 2024, the Bank of England has implemented six interest rate cuts, bringing the base rate to 3.75%. Inflation has held relatively steady between 3.0% and 4.0% throughout the year, with the latest CPI reading at 3.4% in December. Food and non-alcoholic beverage inflation has been more volatile, peaking at peaking at 5.1% in July before falling to 4.5% in December. Governor Andrew Bailey has indicated that rates are ‘likely to continue on a gradual downward path’. Nevertheless, global tensions, including conflicts in Europe and the Middle East, recent developments in South America, and emerging US tariffs, continue to add complexity and uncertainty for the UK market.
“Amid the market complexities outlined above, deal valuations have held steady at c. £2,500m for the year. While not reflected in this figure, the standout transaction of 2025 was the Greencore/Bakkavor merger. This landmark deal represents a major development in the UK convenience food sector, creating a combined group with nearly £4.0 billion in revenues. Although total deal volume was down year-on-year, overall deal value remained robust. Higher-value transactions continued to account for a consistent share of activity, with c. 12.0% of deals exceeding an estimated Enterprise Value of £50.0 million, including c. 7.0% surpassing £100.0 million. UK corporate buyers dominated the market, representing 60.9% of transactions, while overseas buyers accounted for 21.1% and financial buyers 18.0%. These figures are broadly in line with their five-year averages, highlighting sustained appetite across all buyer types throughout the year.”
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Oghma Partners LLP
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