Food & Beverage M&A Pulse – Q3 2026

FOOD & BEVERAGE M&A MARKET DYNAMICS

• While Q3-26 transaction volumes are down from Q3-25, U.S. F&B deal volume rose 18.8% from Q2-26 transactions, totaling 76 compared to 64. The increase was led by strategic buyers, whose deals grew from 55 to 66 over the quarter. Additionally, global activity held steady at 194 transactions in Q3-26, compared to 196 in Q2-26.
• Financial buyers picked up activity globally, completing 29 transactions, up from 22 in the previous quarter.
• Food and beverage manufacturers made up 56.6% of U.S. transactions, with distribution and retail at 32.9%. North America (43.2%) and Europe (34.9%) together accounted for nearly four of every five global deals.
• With deal activity picking back up from Q2-26 lows, Q3 activity gives the market momentum heading into Q4 to close out the year on a strong note.

What We’re Discussing With Clients

2027 Reformulation Deadline Looms Spurring Ingredient Shifts

The FDA has set January 15, 2027 as the deadline for removing Red No. 3 from food. It is also working with industry to eliminate six other synthetic (petroleum-based) dyes by the end of 2027. In addition to government mandates, retailers are also putting pressure on brands with Walmart planning to remove synthetic colors and more than 30 other ingredients from its U.S. store-brand foods by January 2027. Ingredient-related deals tripled year over year in Q3 and buyer interest in specialty manufacturers and custom formulators is expected to stay strong as reformulation drives demand. As a brand owner, expect scrutiny around formulations and questions in diligence around availability of ingredient substitutes.

Private Label Moves Beyond Value Play

Store brands hit record highs in U.S. grocery during the first eight months of 2026: 23.5% of unit share and 21.1% of dollar share. Retailers are also raising the bar on what those products deliver. Kroger’s Simple Truth Protein line and Meijer’s 300 new high-protein, high-fiber items show private label competing to offer superior nutrition and on trend products, not just the most cost-effective option. For co-manufacturers and private-label suppliers, three things are now differentiators: formulation capability, meeting retailer specifications, and scalable capacity.

Beverage Menus Become Growth Platforms

Limited-service restaurants are giving NA drinks a larger role in their growth plans as consumers increasingly visit for a beverage without ordering a meal. Recent industry research identifies the afternoon as the leading occasion for these purchases, giving operators another way to generate business outside lunch and dinner. Heading into 2027, this creates an opportunity for beverage bases, syrups, concentrates and other ingredient suppliers to help restaurant customers develop distinctive offerings that encourage additional visits.