2024 M&A Recap: Consumer Products Take Center Stage, Setting the Stage for a DTC Boom in 2025

Hey there, it’s Jeremiah Wanzell from Growth Mindset Advisors, back with my take on the wild ride that was 2024 in mergers and acquisitions (M&A), with a spotlight on consumer products and what it all means for 2025—especially for middle-market opportunities like direct-to-consumer (DTC) brands. This year was a blockbuster, with seismic moves like J.C. Penney’s SPARC shakeup and Saks snagging Neiman’s, and it’s teeing up a fascinating 2025. Let’s dive in!

2024: A Year of Bold Plays and Reinvention

Picture this: 2024 kicked off with M&A pros shaking off 2023’s hangover—high interest rates, geopolitical noise—and getting back in the game. Global deal value climbed about 9% over 2023, per Bain & Company’s 2025 M&A Report, with consumer products stealing the show. North America saw 75 consumer goods deals announced in Q1 alone, totaling $3.9 billion, according to GlobalData. Heavy hitters like Mars’ $40 billion grab of Kellanova and Campbell Soup’s $2.7 billion scoop of Sovos Brands set the tone, proving big brands were hungry for premium, trend-savvy targets.

But 2024 wasn’t just about the giants—it was a breakout year for strategic pivots and mid-market action. Take J.C. Penney, which teamed up with SPARC Group to create a new entity, Catalyst Brands, merging its legacy with SPARC’s lineup (i.e. Eddie Bauer, Forever 21). This $9 billion revenue juggernaut, backed by Simon Property Group, Brookfield, Authentic Brands, and Shein, isn’t just a lifeline—it’s a bold bet on blending traditional retail with modern synergies (that’s the implied deal thesis but only time will tell if this is a winning strategy). Then there’s Saks, which snapped up Neiman Marcus for $2.65 billion, creating Saks Global—a luxury titan with 75 stores and a war chest from Amazon and Salesforce equity. These moves scream portfolio reinvention, not just survival.

Mid-market consumer brands got love too. ACON Investments scooped up True Religion, the denim icon, signaling private equity’s appetite for established names at inflection points. Meanwhile, Marquee Brands added Laura Ashley to its roster (BCBG, Martha Stewart), banking on heritage to fuel licensed growth. And don’t sleep on Nordstrom, which went private in a $6.25 billion all-cash deal led by the Nordstrom family and El Puerto de Liverpool. It’s a relief to Wall Street’s quarterly grind, giving them room to refocus on their hi-low luxury roots for Nordstrom full line stores and will likely expand the Nordstrom Rack nameplate.

Why the flurry? After inflation squeezed volumes, consumer companies pivoted from price hikes to strategic acquisitions. Divestitures—like Unilever’s ice cream spinoff—freed up cash for targeted buys, and DTC brands, with their digital agility and loyal followings, fit the bill. Private equity (PE) joined the party, with deal value up 34% (PwC data) and $2.6 trillion in dry powder ready to deploy, per Morgan Stanley. 

What Fueled the 2024 Consumer Products M&A Fire?

A few sparks lit this blaze. The Fed’s September 2024 rate cut—the first in four years—eased borrowing costs, greasing the wheels for deals like Saks-Neiman’s. Consumer spending held firm, with U.S. retail sales up 4% annually (McKinsey), favoring premium and purpose-driven goods—DTC’s sweet spot. Regulatory vibes softened post-election, hinting at lighter antitrust scrutiny. And let’s not forget the strategic itch: Saks and Neiman’s merged to dominate luxury, Nordstrom went private to dodge the earnings rat race, and J.C. Penney’s SPARC move fused old-school scale with new-school edge.

2025 Forecast: Middle-Market DTC in the Driver’s Seat

If 2024 was the trailer, 2025’s the feature film for middle-market DTC brands. Here’s my playbook:

1. PE Exits Ramp Up: With 30% of PE portfolio companies over seven years old (Morgan Stanley), that $2.6 trillion war chest will unleash a 16% deal volume spike, per EY. DTC brands—pets, wellness, sustainability—are prime targets. Think True Religion’s ACON deal scaled up.
2. Valuation Gaps Narrow: The buyer-seller disconnect that stalled deals in 2023 faded in 2024 as rates dropped and clarity emerged. Ernst & Young’s Deal Barometer sees a 10% M&A volume bump in 2025, and mid-market DTC brands—less exposed to megadeal scrutiny—could see smoother negotiations. However, there is a caveat (see next point).
3. AI and Tech Boost Valuations: DTC’s AI-driven insights (46% of CEOs see profit lifts, per McKinsey) will fetch premiums. Buyers crave data-savvy targets—J.C. Penney’s Catalyst Brands could leverage this.
4. Corporates Chase Niche: Megadeals like Saks-Neiman’s dodged regulatory flak by focusing on fit, not bulk. PwC says consumer health, pet care, and premium food stay hot—DTC’s lane. Laura Ashley’s Marquee play shows heritage brands can pivot too.

My Advice for DTC Founders in 2025

Are you managing a DTC or Legacy brand and preparing to exit? 

Polish your story—clean financials with a focus on EBITDA ideally above industry averages, illustrate strong growth metrics, and prove you have a multichannel retail strategy in place. Private Equity firms are ready to deploy capital but they are searching for A+ assets (i.e. above average EBITDA and positive growth comps) to acquire so if your company or brand is a B asset (i.e. average EBITDA and flat growth comps), put in the work now to increase your valuation and exit potential. If you are solely relying on e-commerce DTC metrics, you aren’t ready. A balanced distribution model with room to grow will optimally position you and your company to sell at the highest valuation possible.