What Buyers of Food and Beverage Businesses are Looking For

Recent deals in the food and beverage sector show that buyers of food and beverage businesses are becoming more selective. They are not backing businesses simply because demand is resilient, but those that control critical points in the value chain, can withstand operational scrutiny and offer credible routes to scale through category expansion, infrastructure or export exposure.

This reflects a deliberate re-rating of strategically relevant assets across South Africa’s food and beverage sector, particularly for food and beverage businesses that demonstrate strategic positioning and scalability.

Transactions such as Woolworths’ agreement to acquire in2food, Premier’s deal for Rhodes Food Group, Varun Beverages’ acquisition of Twizza and agreement to acquire Crickley Dairy, AIIM’s continued investment in cold-chain infrastructure, and Coca-Cola HBC’s move to acquire 75% of Coca-Cola Beverages Africa all point to a consistent pattern: buyers are prioritising control, resilience, strategic fit and scalability when acquiring food and beverage businesses.

For owners of food and beverage businesses, this changes how value is built and realised.

1. Buyers are Acquiring Control Points, Not Just Products

The strongest theme across recent transactions is a shift toward control. Buyers of food and beverage businesses are securing positions in the value chain that influence margins, supply certainty and long-term competitiveness, whether through supply relationships, infrastructure or multi-category platforms.

The question is no longer just what you sell, but where you sit in the value chain and how critical that position is to a buyer of food and beverage businesses.

2. Operational Credibility is Part of Valuation

Operational quality directly influences valuation. Food safety, traceability, plant standards and compliance are central to how buyers assess risk, particularly in a post-listeriosis environment where expectations have permanently shifted for food and beverage businesses.

Businesses with strong systems, documented processes and credible certifications are easier to diligence and position as premium assets. More broadly, buyers are assessing the durability and transferability of earnings, not just the earnings themselves, when evaluating food and beverage businesses.

3. Export Optionality Expands the Buyer Universe

Export capability does more than diversify revenue. It expands the universe of potential buyers of food and beverage businesses.

Businesses with export exposure or supporting infrastructure attract international strategics and cross-border investors, positioning the asset within a global growth story rather than a purely local one. This often results in stronger, more competitive buyer interest in food and beverage businesses.

4. Strategic Relevance Matters More Than Size

Scale alone does not drive premium outcomes. Many of the most competitive processes involve food and beverage businesses that occupy strategically valuable positions rather than those defined by size.

Whether it is a niche brand with pricing power, a specialised manufacturer, or a logistics asset with infrastructure advantage, buyers are underwriting relevance, resilience and scalability. Food and beverage businesses that clearly align with a buyer’s strategy often outperform larger but less differentiated peers.

5. Buyers are Backing Scalable Platforms

   
   

Across the sector, buyers are backing platforms they can build on, whether through adjacent categories, distribution leverage, production scale or geographic expansion.

Strategic fit matters as much as financial performance. A food and beverage business that aligns with a buyer’s broader growth strategy will consistently attract greater interest.

What this Means for Owners

Strong sector activity does not automatically translate into strong outcomes for owners of food and beverage businesses. A single inbound approach does not establish value, and a single offer rarely reflects what the broader market may be willing to pay.

Premium outcomes are achieved when businesses are prepared early, positioned around the drivers buyers care about, and taken to market through a process that creates genuine competitive tension.

In today’s market, the difference between a good outcome and a premium one for food and beverage businesses is not just the business itself, but how it is prepared, positioned and taken to market.