M&A activity in the floriculture sector ready to pick up pace
M&A Developments | Floriculture | H2 2023
In line with our expectations, the floriculture sector experienced a modest uptick in dealmaking activity in the second half of 2023.
However, just like the overall economy, dealmaking activity remained relatively slow. We have identified 49 transactions during the period, which is somewhat higher compared to the 46 transactions observed in the first half of 2023 and consistent with the 49 transactions observed in the second half of 2022.
Uncertainties regarding a potential upcoming recession, energy prices, low consumer confidence and limited and expensive funding for M&A transactions contributed to the overall moderate dealmaking environment.
Having said that, not all segments within the floriculture sector experienced moderate dealmaking. We have witnessed a lot of M&A transactions in the equipment, engineering and services category, especially in software. This is amongst others driven by strong market growth tailwinds in categories such as robotics, machine vision, data and AI, which, combined with solid consolidation rationales, lead to a lot of M&A activity. In light of that, in January 2024, we will publish a separate newsletter on M&A trends within horticulture robotics, machine vision, data and AI.
With the chances of a recession fading away, energy prices finding a new balance and companies performing well, we expect that 2024 will be a good year for floriculture M&A. Our internal project pipeline also reflects this positive outlook.
As the turmoil surrounding energy prices and a pending recession have faded away, and signs for 2024 are promising, we anticipate a renewed wave of consolidation in the floriculture sector after a brief interruption.Frank de Hek, Oaklins' horticulture specialist
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