A total of 387 mergers and acquisitions were made by consumer staples companies in the fourth quarter of 2019, down 24.6% year over year from 513 deals, according to data compiled by S&P Global Market Intelligence.
M&A activity by value came in at $6.08 billion for the three months ended Dec. 31, 2019, down 58.6% from $14.68 billion in the same period in 2018.
For the full year, M&A activity involving consumer staples companies plunged 39.2% to $60.46 billion from $99.51 billion in 2018. The number of deals in the consumer staples sector declined for the third year running, slipping to a total of 1,731 from 1,769 in 2018.
Fourth-quarter 2019 M&A activity by value fell for the fourth consecutive year since 2016, when British American Tobacco PLC acquired 57.8% of cigarette manufacturer Reynolds American Inc. for $62.45 billion.
Food producers continue to lead M&A activity across the segment, spending a combined $2.91 billion in the fourth quarter. However, the figure was down 62.7% from $7.81 billion in the fourth quarter of 2018. The number of deals in the food sector also fell to a total of 160 from 201 transactions in the year-ago quarter.
The personal products segment came in second in terms of deal value with $1.54 billion worth of transactions in the fourth quarter but was down 32.9% from $2.29 billion in spending the prior year. Just 29 deals in the personal products segment were recorded during the quarter, nearly 50% down from 56 deals in the fourth quarter of 2018.
Shiseido Co. Ltd.'s $845 million purchase of U.S. skincare brand Drunk Elephant Holdings LLC was the biggest deal in terms of value among consumer staples companies during the three-month period. The $600 million sale of American media personality Kylie Jenner's 51% stake in beauty company King Kylie LLC to New York-based Coty Inc. was the second-largest transaction across the sector.
M&A activity involving food producers made up the bulk of total deals in the consumer staples sector. The $546.7 million sale of sweeteners-maker Flavors Holdings Inc. to Act II Global Acquisition Corp. was the largest among all food producers in the sector. It was followed by the sale of 81% of Australian agribusiness company Webster Ltd. to Public Sector Pension Investment Board for $487.8 million and China Mengniu Dairy Co. Ltd.'s purchase of Australian dairy products and juice business Lion-Dairy & Drinks Pty. Ltd. from Japan's Kirin Holdings Co. Ltd. for $406.3 million.
In the beverages sector, M&A activity more than doubled in value to $753.1 million across 39 deals in the fourth quarter of 2019 versus $347.5 million and 36 transactions the prior year.
Among beverage companies, Anheuser-Busch InBev SA-owned Anheuser-Busch Cos. LLC's acquisition of a 68.9% stake in Craft Brew Alliance Inc. for $288.1 million was the largest transaction in the fourth quarter, followed by Lotte Chilsung Beverage Co. Ltd.'s purchase of a 57.8% stake in Pepsi-Cola Products Philippines Inc. for $224.4 million and the sale of Italian wine exporter Farnese Vini Srl to Platinum Equity LLC for $202.0 million.