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12.01.16

Brands Eyeing M&A to Drive Innovation

Scott Caras

In his recent article, We are on the verge of a consumer M&A avalanche, Circle Up’s founder Ryan Caldbeck describes the critical role of acquisition in the growth of consumer products companies. Caldbeck claims that insufficient organic growth and a lack of innovation have created an environment where large CPG companies are reliant on acquisition to achieve shareholders’ growth objectives: “What we have here is the perfect storm for a consumer mergers and acquisitions avalanche.”

The article cites compelling statistics relating to the declining market share and revenue of large CPG companies, and claims that acquisitions have become consumer brands’ substitute for R&D as the principal tool to effectively drive growth.

“The forces behind an M&A avalanche have been building for several years. Last year alone the M&A in consumer and retail was $238 billion, almost twice the size of M&A in tech.  The M&A avalanche signals are there, and they’re only growing stronger.”

While the article focuses primarily on large CPG companies, the rationale for acquisitive growth is just as compelling for middle market companies. Breakaway Advisor’s On Demand Corporate Development services enable middle market companies to attain the benefits of acquisitive growth without the long-term financial commitments of an internal corporate development team. Leveraging the firm’s deep understanding of consumer brands, expertise in deal execution and a robust understanding of financial markets, we provide flexible corporate development solutions that facilitate middle market companies in accelerating growth through strategic acquisition.

Interested in learning more? Reach out at [email protected] and we can grab a coffee, beers or take a couple casts for striped bass on the South Shore.