M&A activity in the UK’s food and drink sector remained resilient in 2025, despite widespread geopolitical uncertainty, with dealmaking boosted by gradual economic improvement.
According to a new report from Oghma Partners, there were 133 transactions in the sector during 2025, down 12 per cent from 2024. Excluding the £1.2 billion acquisition of Bakkavor by Greencore, there was an aggregated value of approximately £2.5 billion, down 9 per cent from the previous year.
Deal activity, in general, remained robust during 2025, but there was a significant slowdown during the third quarter, which saw a 33.9 per cent year-on-year drop in volume. Despite this decrease, value remained steady, reaching approximately £540 million, compared to £612 million in Q3 2024.
Mark Lynch, partner at Oghma Partners, said that the year had been “characterised by geopolitical uncertainty”, but that UK dealmaking had remained resilient “supported by the gradual recovery of the economy.”
The majority of deals involved UK corporate buyers (60.9 per cent), while overseas buyers accounted for 21 per cent and financial buyers, including private equity, were involved in 18.2 per cent of deals.
Continuing a trend seen during 2024, the market was dominated by smaller deals during 2025, with transactions valued at £10 million or less accounting for 64.5 per cent of deals (down 5.1 per cent from 2024). Deals valued at £50 million or more made up just 12 per cent of the total, up 3 per cent from the previous year and consistent with the 12 per cent five-year historic average.
The drinks sector made up more than a quarter (26.3 per cent) of transaction volume, while there was also significant consolidation in the meat sector, especially among smaller operators, driven by longstanding, persistent cost pressures and rising meat prices.
Other areas to see notable dealmaking included sports nutrition and the chilled foods sector, where the Compleat Food Group completed a number of acquisitions, including The Yorkshire Pudding Co, Freshpak Chilled Foods and Julienne Bruno. The firm also completed a deal for Greencore’s soups and sauces division in January 2026.
Mark Lynch cited the Bank of England’s six interest rate cuts since August 2024 and steady inflation as key to the UK’s economic recovery, but pointed out that food and non-alcoholic beverage inflation had been “more volatile, peaking at peaking at 5.1% in July before falling to 4.5% in December.”
While rates are broadly expected to continue to come down, Lynch said that global tensions and conflicts are continuing to add to uncertainty and complexity in the UK market.
Against this backdrop, Lynch added, UK valuations had held steady at approximately £2.5 billion in 2025, with this figure not reflecting the “standout transaction” of the Greencore/Bakkavor merger.
According to Lynch: “This landmark deal represents a major development in the UK convenience food sector, creating a combined group with nearly £4 billion in revenues."
Regarding food and drink M&A in 2026, Oghma Partners say they expect dealmaking to continue across subsectors, with large corporates seeking to diversify their portfolios and build geographic presence.
With inflationary pressures continuing despite interest rates easing, Oghma Partners predict that M&A will continue to be selective and strategic and that volumes and values will remain broadly in line with the levels seen in 2025.
The report added that 2026’s outlook was again tempered by geopolitical uncertainty and that buyer behaviour is also likely to be impacted by anticipated business cost increases and continuing consumer caution.
Find out more about dealmaking in the UK food and drink sector
Read our in-depth outlook on M&A in 2026
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