KPMG, the global consultancy company, has revealed that despite the slow global economic recovery, consumer good companies are open to mergers and acquisitions to bolster their competitive edge. According to an intrenational study by KPMG, “FMCG firms are actively pursuing growth opportunities to chart their future path amid uncertain economic conditions. In some markets, M&A activity in the consumer sector should increase over the next 18 months.”
The study further revealed that in markets like India, China and Russia, consolidation of smaller companies to improve production and product pricing, are the main factors driving the rise in M&A deals. “We are witnessing robust recovery in M&A in the Indian consumer markets. The household and personal care segment, which is largely consolidated in India, has witnessed significant outbound M&A activity in the last two years,” says Nandini Chopra, ED & Practice Head (Consumer & Retail, Corporate Finance), KPMG India.
As reported earlier in Ibob newsletter, a significant testimonal to the finding is the recent aggressive M&A movement by Indian FMCG players, such as Colagate Palmolive’s merger with CC Healthcare and Marico’s three global aquistions with Derma RX, Personal Care brand ‘Code 10’ and South African Brand ‘Ingwe’.