The U.S. food sector has experienced a surge in merger activity, with two significant deals emerging within 24 hours. Sysco’s $29 billion agreement to acquire Jetro Restaurant Depot and McCormick’s nearly $45 billion deal to acquire Unilever’s food business have gatecrashed the ranks of the biggest global transactions of the first quarter. According to LSEG data, it is the first time since 2015 that two U.S. consumer deals have cracked the top 10 in the same quarter.
McCormick’s deal ranked second globally in the first quarter, trailing only Amazon’s $50 billion investment in OpenAI. These transactions reflect a broad reshaping across the industry aimed at addressing shifting consumer tastes, rising tariffs, and slowing growth. McCormick is a global leader in flavour, manufacturing, marketing, and distributing spices, seasoning mixes, condiments, and other flavourful products to retail outlets, food manufacturers, and foodservice businesses. Sysco is a global food distribution company that delivers food and related products to restaurants, healthcare and educational facilities, lodging establishments, and other foodservice customers.
Ongoing discussions suggest this trend is not limited to the food sector. Jack Daniel’s maker Brown-Forman is in talks with France’s Pernod Ricard, while beauty company Estée Lauder is in discussions with Barcelona-based Puig. These combinations would potentially create companies worth tens of billions of dollars. Jens Welter, Citi’s co-head of North America investment banking coverage, noted that many fast-moving consumer goods companies are seeking alternative ways for growth through consolidation.
Experts suggest that these deals are driven by a need for scale and diversification in a volatile market environment. Consumer companies are under increasing pressure to stay ahead of rapidly shifting generational tastes, requiring greater agility and adaptability. Jeannette Smits van Oyen, JPMorgan’s global head of consumer and retail investment banking, also points out that such decisions become more fundamental for family constituents in evaluating their alternatives.
