Surge in mergers and acquisitions within food ingredient industry

Food ingredients mergers and acquisitions (M&A) are experiencing a significant surge in activity. The current year is witnessing a remarkable increase in deal-making in this sector, surpassing previous records with 40 transactions completed thus far. The collective value of these deals already exceeds that of the entire year of 2024. This trend indicates a robust and thriving market for M&A in food ingredients.

According to a recent report by Oghma Partners, a leading financial advisor based in the UK, the European food ingredients sector has seen a substantial spike in M&A activity. Since 2019, there have been a total of 305 M&A transactions in this sector, amounting to a combined value of €87.3 billion. In 2025 alone, the value of M&A deals has reached €3.87 billion, surpassing the previous year’s total. While 2019 and 2023 saw higher values due to significant mergers, this year is expected to set a new record in terms of the number of deals.

Contrary to previous years where smaller deals dominated the market, 2025 has seen an increase in transactions falling within the €10–50 million range. This shift indicates a growing appetite for mid-sized deals driven by motives such as geographic expansion, innovation, and sustainability. The report highlights that cross-border transactions account for more than 65% of all deals, with nations like Spain, France, and the UK being favored locations for such activities.

The food ingredients market is characterized by a diverse landscape, with major players worth over €50 billion coexisting with smaller specialized companies valued at less than €30 million. This diversity creates a dynamic environment where innovative startups with sustainable offerings can gain market share. Private equity firms have played a significant role in M&A deals, contributing over two-fifths of total transactions since 2020.

While most acquisitions have taken place in Western Europe, there is a growing interest in expanding operations to regions like Portugal, Turkey, and the Nordics. Turkey, in particular, is projected to experience the highest growth in deal volume by 2029, exceeding 23%. The surge in M&A activity is fueled by various trends such as health consciousness, clean-label products, sensory experiences, and sustainability concerns.

In addition to traditional trends, there is an increasing demand for dual-functional ingredients that offer both sensory appeal and functional benefits. Geopolitical instability and climate-related challenges have also prompted the search for alternative ingredients in response to supply chain disruptions. Sectors like protein, botanicals, and cultures are experiencing rapid growth rates exceeding 7% annually.

Within the food ingredients industry, additives, blends, and distribution have emerged as the most active subcategories for M&A transactions. Distribution accounts for a significant portion of deal volume, followed by additives and blends, reflecting the continued strength and growth potential of the food ingredients market. Overall, the sector continues to show promising growth prospects and investment opportunities for stakeholders.