Swiss M&A trends in consumer markets

M&A activity in consumer markets has been subdued over the past two years due to macroeconomic uncertainties, financing challenges, and price mismatches between buyers and sellers. In 2024, deal volume decreased by 16% compared to 2023, while deal value increased by 13%, driven by several large transactions. Consumer sentiment remains fragile amid inflation, interest rates, and geopolitical uncertainties, yet some of these negative factors are easing as we enter 2025.

Price pressures persist in some regions, but global inflation and interest rates have broadly stabilised, albeit at higher levels than before. The International Monetary Fund is forecasting steady global GDP growth in 2025/26, and market confidence is returning. Reflecting this optimism, company valuations in consumer markets are rising – PitchBook data shows that North American and European EBITDA multiples for the sector increased from 9.0 in 2023 to 9.5 in Q3 2024, while revenue multiples increased from 1.0 to 1.2 over the same period.

Corporate players are actively reshaping their portfolios through divestments, market expansion, and strategic acquisitions, as seen in Mars’ proposed acquisition of Kellanova and Unilever’s planned spin-off of its ice cream business. Meanwhile, private equity is expected to bring more consumer assets to market in 2025, driven by extended holding periods, improved exit conditions, and increased pressure to return capital to investors.

We expect the trend of take-private and delisting transactions to persist into 2025, particularly in markets outside the US, where public valuations in the consumer sector remain relatively low. Notable recent examples include the delisting of Tod’s following its acquisition by L Catterton, Apollo’s bid for International Game Technology’s gaming and digital business, and International Paper’s proposed acquisition of DS Smith.

Overall, growing optimism in consumer markets, rising valuations, and a stronger deal pipeline bode well for dealmaking in 2025.

M&A volumes in consumer markets fell by 16% between 2023 and 2024, slightly outperforming the global M&A markets as a whole, which saw deal volumes fall by 18% over the same period. Deal value in consumer markets increased by 13%, driven by two deals worth more than $30bn and six other megadeals (deals worth more than $5bn).

However, M&A trends in 2024 varied by region. In Asia-Pacific, deal volumes fell by 13%, but values rose by 15%, with the exception of India, which recorded strong growth. Japan saw higher deal values due to a megadeal, but experienced a 16% decline in volumes, while China and Australia saw double-digit declines in both metrics. In EMEA, deal volumes fell 18%, weighed down by inflation and geopolitical uncertainty, but deal values rose 15%. The Americas followed a similar pattern, with deal volumes down 17% but values up 12%, largely driven by US activity, while Latin America saw a sharper 37% decline in deal values.

2024 in the rear-view mirror

Deal activity in consumer markets remained steady at 85 transactions in 2024, signalling continued investor confidence despite global economic uncertainties. A sector break-down reveals several key trends shaping the market:

Retail dominates once again
Retail accounted for the largest share of deals (37 transactions), continuing its position as the most active sector. While slightly down from the 43 deals in 2023, the sector’s resilience suggests sustained investor interest in brick-and-mortar and e-commerce opportunities, likely fuelled by Switzerland’s stable consumer base and evolving omni-channel strategies.  A case in point is Thailand’s Central Group, which acquired full ownership of Magazine zum Globus AG, the Swiss luxury department store chain.

Consumer goods M&A surges to a six-year high
The consumer sector saw 27 deals, a significant increase from previous years and the highest deal volume in the past six years. This growth indicates heightened strategic and private equity interest, particularly in premium, sustainable, and health-conscious brands, reflecting shifting consumer preferences. And example is Hero Group’s acquisition of healthy eating brand Deliciously Ella.

Hospitality and leisure take a dip
In 2024, the Swiss hospitality and leisure sector experienced a significant decline in M&A activity, recording only 11 deals, the lowest volume observed in recent years. This downturn may be attributed to several factors, such as the strong Swiss franc, global economic challenges affecting discretionary spending, and a post-pandemic market adjustment, with fewer distressed assets available for acquisition compared to 2021/22. A segment of strong interest, however, is the Swiss alpine tourism industry, where Vail Resorts Inc. acquired Crans-Montana Mountain Resort in late 2024.

Modest activity in forest, paper and packaging, as well as in transportation and logistics
While transportation and logistics (5 deals) and forest, paper and packaging (5 deals) remained relatively quiet, these sectors continue to play a key role in Switzerland’s broader consumer markets ecosystem. Packaging firms in particular may attract more interest in the future due to sustainability-driven innovation and regulatory changes.

2025 outlook

As we progress through 2025, the M&A landscape in the Swiss consumer markets sector is poised for significant activity. Several key trends are expected to shape domestic dealmaking:

1. Digital transformation and AI integration

The rapid advancement of artificial intelligence (AI) and digital technologies is expected to drive Swiss companies to seek acquisitions that bolster their technological capabilities. This trend is evident in the packaging industry, where companies such as Amcor (packaging) have pursued significant acquisitions to enhance their market position and technological prowess.

2. Portfolio optimisation and divestitures

Companies continue to focus on their core competencies, leading to the divestiture of non-core assets. This strategic portfolio reshaping is expected to bring more assets to market, providing opportunities for both buyers and sellers to realign their business models and pursue growth in areas where they hold competitive advantages.  Recent examples include Nestlé’s announcement to explore potential partnership opportunities for its water and premium beverages business and Migros’ strategic divestments of brands such as Melectronics, SportX, and Mibelle.  

3. Inbound investment and cross-border M&A

In 2024, Switzerland has continued to attract significant foreign investment, with about $13bn of announced inbound M&A deals. Germany, the United States, and the United Kingdom were among the leading acquirer nations (source: Herbert Smith Freehills). Notable deals by foreign investors include Regent’s (US) acquisition of Swiss luxury brand Bally, LVMH’s (France) acquisition of Swiza, the owner of clock manufacturer L’Épée, and Central Group’s (Thailand) full ownership acquisition of department store chain Globus AG. We anticipate this trend to continue into 2025, as Switzerland’s political, regulatory, and economic stability continues to appeal to international investors amid ongoing macroeconomic uncertainties.

4. Consumer resilience amid economic fluctuations

Despite modest projected GDP growth of 1.5% in 2025, slightly below the long-term average of 1.8%, Swiss consumers are demonstrating resilience. Inflation is anticipated to decrease to 1.1% in 2025, contributing to a stable economic environment. This stability supports sustained consumer spending, making the Swiss market attractive for M&A activity in the consumer sector.

In summary, the Swiss consumer markets sector is set to experience robust M&A activity in 2025, driven by AI and digital transformation, strategic portfolio adjustments, continued inbound investment and consumer resilience. Companies that use M&A as a tool to proactively adapt to these trends are likely to gain a competitive edge.