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When talking about the impacts of climate change, few risks are more visceral or tangible than those it poses to future food supply. From spikes in food prices to threats to the coffee industry, consumers are increasingly aware of the effects of rising global average temperatures.

For companies in the food, beverage and tobacco sectors, climate change presents a two-fold challenge: the industry is highly exposed to climate-related impacts, but is at the same time a major contributor to increasing global greenhouse gas (GHG) emissions levels – particularly from agricultural production, which according to the IPCC causes 10-14% of global GHG emissions.

Merger

Mergers & Acquisitions in Food and Beverage

Global Consumer M&A had a strong first half to the year, with transactions valued at US$ 202.5bn topping every H1 deal value since 2008 and representing a 42.8% uptick in deal value compared to H1 2014. The increase stemmed from two domestic mega-deals, together accounting for 47.1% of total deal value: HJ Heinz’s US$ 54.5bn acquisition of Kraft within the US food sector and Cheung Kong Holdings US$40.8bn acquisition of CKH & Hutchison Whampoa within Hong Kong’s retail sector. As a result, the Consumer sub-sectors food (US$ 80.2bn) and retail (US$ 105bn) saw an increase in deal value by 129.9% and 106.9% respectively compared to H1 2014 (food worth US$ 34.9bn; retail worth US$ 50.8bn). Food deal value reached its highest H1 deal value since 2007, whilst retail reached its highest H1 deal value on Mergermarket record.