Insights from Baird’s 150 Mid-Market Consumer Deals include Valuation Drivers and M&A Trends
Milwaukee, Sept. 19, 2017 – Baird Global Investment Banking, a business unit of the employee-owned, international financial services firm, Baird, today released a report finding that mid-market M&A activity in the consumer sector continues to flourish. The report includes analysis of over 480 mid-market consumer transactions in North America and Europe across seven subsectors, which yielded an average valuation of 11x EBITDA.
The M&A market analysis showcases that the consumer sector is arguably the fastest changing sector in our world today, facing disruption from innovation, penetration of technology and rapidly evolving consumer preferences. Companies taking advantage of these changes are breathing new life into mature categories, giving today’s consumer more options.
According to the Baird report, large mature conglomerates are losing share to newer, more innovative consumer companies with differentiated business models. Strategic buyers, struggling with slower organic growth, are using M&A to acquire more nimble, faster growing mid-market companies. Private equity firms that are providing operational expertise and supporting growth initiatives are well placed to generate attractive investment returns.
Baird identified six key business model attributes that create value when acquirers evaluate targets:
- Is the brand authentic?
- Is the product innovative?
- Does it leverage digital strategies?
- Does it have an omni-channel model?
- What is its white space growth strategy?
- And finally, how resilient is it to Amazon?
"We have seen a bifurcation in the quality of companies in today’s rapidly changing consumer sector,” said Tahs Siddique, Director in Baird’s M&A Research. “This report explores what is driving high valuations and competitive processes that have buyers from all over the world acquiring the most attractive consumer companies."
To find out more on attractive business model characteristics, mid-market consumer M&A trends and investment themes by subsector, download highlights of the report or request a full copy.
About Baird Global Investment Banking
Baird is a leading global investment bank focused on the middle market. Approximately 270 investment banking professionals in the U.S., Europe and Asia provide corporations, entrepreneurs, private equity and venture capital firms with in-depth market knowledge and extensive experience in merger and acquisition, debt advisory and equity financing transactions. Since 2012, Baird has completed nearly 430 advisory transactions representing more than $113 billion in transaction value and 518 financings raising more than $135 billion. Committed to being a great place to work, Baird ranked No. 4 on FORTUNE’s 100 Best Companies to Work For in 2017 – its 14th consecutive year on the list.
Baird is an employee-owned, international wealth management, capital markets, private equity and asset management firm with offices in the United States, Europe and Asia. Established in 1919, Baird has more than 3,400 associates serving the needs of individual, corporate, institutional and municipal clients. Baird has $171 billion in client assets. Committed to being a great place to work, Baird ranked No. 4 on FORTUNE’s 100 Best Companies to Work For in 2017 – its 14th consecutive year on the list. Baird is the marketing name of Baird Financial Group. Baird’s principal operating subsidiaries are Robert W. Baird & Co. in the United States and Robert W. Baird Group Ltd. in Europe. Baird also has an operating subsidiary in Asia supporting Baird’s investment banking and private equity operations. For more information, please visit Baird’s Web site at rwbaird.com.
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Baird Public Relations