Globally food and drink M&A value grew by 9% in 2025, reaching US$110.9 billion, new research from Baker Tilly International shows.
This marks sustained multi-year recovery since the $59.4 billion in deals completed in 2022, signalling growing confidence and appetite for dealmaking in the year ahead.
Still, it should be noted that recovery is modest amid a cautious F&B environment, particularly compared to the overall M&A (all sectors) market where deal value surged by 45%.
Food and drink mid-market deals
While headline figures in the Baker Tilly report, ‘Global dealmakers 2026′ point to a more buoyant F&B market, the picture looks different when zoomed in on the mid-market (deals valued between $15 million to $500 million) sector.
Here, dealmaking followed a more measured trajectory in 2025, with value remaining relatively flat at $20.4 billion, representing just a 1% year-on-year increase.
Meanwhile, volume dropped by 1%, contrasting with 4% growth in transactions across the wider mid-market (all sectors).
As the report details, this reflects a cautious recovery profile for the F&B mid-market sector. Investors are willing to commit capital but will be selective, opting for businesses with differentiated offerings, pricing power and a clear strategic fit.
Private equity pulls back
The report highlights a growing gap between strategic and financial buyers.
Private equity activity in the mid-market F&B sector weakened significantly in 2025, with both buyout value (-35%) and volume down (-31%).
Meanwhile, strategic buyers remain more active, reflecting stronger balance sheets and a continued focus on acquisitions that support portfolio optimisation, scale and long-term growth.
Dealmakers appear willing to write bigger cheques but only for assets with clear strategic flavour.
Baker Tilly International - Global dealmakers 2026: Mid-market food and beverage M&A data pulse
According to the report, corporates are focusing on acquisitions that deliver clear synergies, scale advantages and alignment with portfolio optimisation strategies.
The move away from traditional financial sponsors is also creating a wider opening for sovereign wealth funds and family offices. The report notes that these investors are increasingly well positioned to pursue direct deals or co-investment alongside strategics – and many are less constrained by leverage and short-term return pressures.
Portfolio restructuring
A key driver of current deal activity is ongoing portfolio optimisation among large corporates. Companies are increasingly reallocating capital from low-growth segments towards premium, higher-margin categories, driving portfolio rationalisation and divestitures.
These ongoing restructurings are generating a steady pipeline of mid-market carve-outs, while also intensifying competition for high-quality assets, as corporates seek to diversify, scale and future-proof their businesses.
Dealmakers are also continuing to seek out cross-border M&A to access both developed and emerging market opportunities. Broader F&B deals trends saw a sharp upswing in value, with a more marginal lift in volume.
Mid-market ventures, meanwhile, declined in value and volume; representing a much more selective approach as dealmakers prioritise strategic fit and operational resilience over aggressive overseas growth.
The report also shows technology as an increasingly important value driver, with dealmakers focusing more on acquisition targets that enable data analytics, AI-assisted demand forecasting, inventory optimisation, supply chain efficiency and enhanced customer engagement.
The results suggest “significant untapped potential” in the mid-market, with attractive upside through e-commerce expansion, AI-enabled marketing and data-led pricing strategies.
Mid-market geographical hotspots
While global F&B mid-market M&A remains active, regional dynamics are diverging sharply. Growth is increasingly concentrated in Asia Pacific, while more mature markets face slowing momentum and heightened dealmaking caution.
Asia Pacific held the largest share of mid-market F&B dealmaking, with 41% of deals and 39% of mid-market value in 2025. While volume declined 5% in 2025, value increased by 8%.
Strong demographics, rapid urbanisation and expanding middle-class demand for premium food items continue to underpin the region’s attractiveness for capital.
North America accounted for 21% of mid-market deal value and 17% of volume in 2025. However, both value (-27%) and volume (-24%) saw sharp year-on-year drops, with dealmakers pausing activity amid tariff and regulatory uncertainty.
Western Europe accounted for 24% of deal value and 23% of deal volume in 2025, broadly in line with its share of overall mid-market activity. Deal value rose 15% year-on-year and volume saw a modest 2% incline, signally stable but gentle recovery.
Health, convenience and premiumisation drive interest
The food sub-sector continued to dominate mid-market dealmaking, accounting for 76% of deal value and 82% of volume in 2025.
Demand for healthier products, convenient formats and premium offerings is expected to carry on shaping deal activity through 2026 and into 2027.
Although food represented the majority of mid-market dealmaking across F&B, the report flags beverages as an emerging area of growing strategic interest.
The beverage sub-sector accounted for 24% of deal value and 18% of deal volume, with activity increasingly shaped by demand for healthier, functional and premium products.
The convergence of food, health and technology – from new nutritional options to artificial intelligence (AI)-driven supply chains – is also opening new frontiers for investment.
Baker Tilly International - Global dealmakers 2026: Mid-market food and beverage M&A data pulse
Investor attention is expected to focus on categories such as low- and no-alcohol drinks, functional beverages and other better-for-you alternatives, driven predominately by health-conscious younger consumers.
As such, we’re likely to witness a mix of targeted growth investment in faster-growing segments and further consolidation across more mature beverage categories.
2026 outlook
Looking ahead, deal activity is expected to remain supported by ongoing corporate portfolio reshaping, demand for health and wellness-focused assets, and a gradually improving financing backdrop.
While cross-border activity may take longer to recover, the underlying fundamentals of the food and beverage sector continue to offer attractive opportunities for strategic investors.
“F&B dealmaking is entering a more selective phase. Buyers are looking beyond scale to clear consumer relevance, pricing power and resilience,” said Harsh Maheshwari, global advisory services leader at Baker Tilly International.
“In the mid-market, this creates strong opportunities for brands built around health, convenience, premiumisation and supply chain resilience. As confidence improves, the most attractive assets will be businesses that sit closest to changing consumer demand and are agile enough to scale through new channels, markets and technology.
“What makes mid-market F&B so compelling right now is the diversity of deal flow. Mature markets are producing carve-outs and succession-driven opportunities, while high-growth markets are surfacing younger, faster-growing targets in categories that barely existed a decade ago. Both offer real opportunities for different reasons.”
