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While we expect M&A activity to continue to pick up over the next five years, those leveraging the best insights regarding the evolution of the market landscape to inform a modernized and globally-oriented F&B investment thesis are set to lead (and even create) segments and categories.
There’s plenty of capital to put behind foodservice companies, and some that are not even in the radar right now (like those looking to alternative formats and improved unit economic models as well as transformative technologies) will jump to very large valuations in the next few years.
Here are ten of the most popular pieces we’ve shared, all informed by our experience supporting both operators and investors in the foodservice and hospitality sectors:
Strategic levers for restaurant M&A are not necessarily new, but understanding the evolving landscape enables non-traditional value-creation opportunities. When the right components are combined within a platform, the whole can be much greater than the sum of its parts (and this is reflected in valuations). Read More
As Private Equity activity continues to flourish in the foodservice sector, restaurant valuation multiples have followed suit — rising even when deal volumes drop. Premiums for high-quality targets are on the rise, with valuations reaching their highest multiple (11.1x) since 2007. Read More
Whether to achieve consistent top-line growth, expand market share, enter fast-growing new markets, add new capabilities, remain current with shifting consumer demands, or integrate value-enhancing technologies, acquisitions make strategic sense in this era of cheap capital, fierce competition, and moderated growth. Read More
A number of the largest and best-known publicly traded food service companies in the U.S. are choosing buybacks and dividend increases over investing in their existing locations, opening new units, or acquiring new concepts. Read More
While those in the financial and banking sectors often perform the due diligence on those deals, a firm with extensive restaurant experience and a deep knowledge base can deliver insights based on operational and commerical audits that might otherwise be passed over by a generalist advisor. Read More
As deal size has almost doubled across North America and Europe over the last decade, we’re seeing more consolidation as portfolios are making a number of different-sized acquisitions quickly, and convenience and tech both continue to be hot trends for foodservice-related investments. Read More
Like all transformations, a positive outcome following an investment depends on leaders’ understanding of what gives the brand value. It takes more than “good food, good service, good atmosphere” to launch, grow, and maintain a successful restaurant operation, and institutional investors, as well as private equity funds, can often step in to back new concepts or help established chains grow. Read More
Since January of 2017, nearly $15b worth of public restaurant stocks in the U.S. delisted, as nine companies left public exchanges for private hands. While the total value and number of global IPOs are increasing, fewer U.S. foodservice companies are going public. The pains of going public these days can be avoided while still gaining funding, as there are trillions in private equity capital ready to be invested in global markets. Read More
How could you grow your business with a $50m private equity investment? Would you expand into new markets, roll out the prototypes you’ve been dreaming of, or deploy new technology to make it even easier for diners to get your food? Here we offer a brief overview of PE funds operations, focusing on each stage of the deal. Read More
Signing a deal with a private equity firm can, naturally, have profound effects on the organization operationally in addition to the impact on value creation strategies and resources. The process has its risks, and teams can often disagree on how to reach goals. Here’s a guide to help restaurant executives prepare for taking on a private equity investment. Read More
As dry powder continues to grow, a lower middle-market restaurant investment can offer a risk/reward combination on-target with an investment firm’s criteria. These concepts are becoming an investment sweet spot with valuations attesting to profitability and strong growth. Read More
In any scenario, superior intelligence and insights relative to understanding the landscape and how the consumer and competition are being reshaped are required to create a compelling and modernized investment thesis.
When the right components are combined within a platform, the whole can be much greater than the sum of its parts (and this is reflected in valuations). If that’s something you’d be interested in, we can help. We support both with sell-side mandates and middle-market buy-side advisory for restaurant industry investments.