M&A and Capital Markets Activity in North American Consumer and Retail Sector


Consumer and retail were some of the most resilient sectors in Q3 2022. Despite low volumes, rising costs, supply chain disruptions, and a lowered guidance in Q3 2022, the sector has continued to grow, albeit at a much slower pace than in 2021.

According to the US Census Bureau’s seasonally adjusted data, retail and food services sales grew by 9.2% Y-o-Y to USD 2,049.3 billion in Q3 2022, from USD 1,875.9 billion in Q3 2021, driven by the food and beverage; motor vehicles and parts dealers; and general merchandise segments.

In September 2022, US retail sales stood at USD 684.0 billion, flat compared with the previous month, because consumers were more cautious about spending on discretionary and big-ticket items such as motor vehicles and electronic appliances, amid the worst inflation that the US has faced in decades and rising interest rates.

The Q3 2022 numbers for US e-commerce sales have not been released yet. We expect the figures to be somewhat in line with the previous quarter. In Q2 2022, e-commerce revenue was USD 257.3 billion, 6.8% higher than USD 240.9 billion in Q2 2021. The e-commerce segment’s Q2 performance was relatively muted, as Amazon.com moved its popular Prime Day sale from June to July this year. Online penetration stood at 20.8%, almost the same as in the year-ago quarter.

Figure 1: US Retail Sales – Y-o-Y Change (%)

Source: U.S. Census Bureau

According to a report by the Bureau of Labor Statistics, the unemployment rate in the US decreased by 0.2% to 3.5% in September 2022, pointing towards a tightening labor market. The number of unemployed people declined by 263,000 to 5.8 million in September 2022. However, the employment rate in the retail sector has shown little change on an M-o-M basis.

M&A Activity

M&A activity in the consumer and retail sector in the Americas (North America, the Caribbean, and Latin America) declined by 21.8% in Q3 2022 to USD 32.3 billion, compared with USD 41.3 billion in Q2 2022. The downside can be attributed to a significant dip in M&A activity in the retail and consumer discretionary segments.

As of September 2022, 2,474 M&A deals have been announced in the sector, down 7.3% on a YTD basis compared with September 2021.

The decline in M&A deal volume can be attributed to rising inflation and higher cost of borrowing that has hurt the confidence of many potential investors.

Figure 2: M&A Deal Volume

(Total Deal Value in USD billion)

Source: Refinitiv Deals Intelligence


As of October 13, 2022, there were 15 bankruptcies in the US retail sector, which is the lowest number of bankruptcies filed in comparable periods since 2010.

Figure 3: Bankruptcies in US Retail Sector (2010–22)

Source: S&P Global Press Releases

NewAge, a seller of beverages, supplements, and other health and wellness products, filed for bankruptcy in August 2022. The company plans to auction itself and has received a bid of USD 28 million from DIP Financing. It has also received USD 16 million in financings, which will help it to survive through the sale process.

Packable Holdings, a privately-owned tech-enabled e-commerce retailer, filed for bankruptcy after it failed to go public through a merger with a special-purpose acquisition company (SPAC) in August 2022. The company had liquidity issues and was forced to wind down its operations.

We believe retail bankruptcies will remain low in 2022; however, they may resurface in 2023 due to a looming global recession.

Capital Market Activities

Capital-raising activities in the Americas continued to decline towards historically low levels due to a series of macroeconomic headwinds such as inflation, rising interest rates, and geopolitical uncertainties. The value of debt-raising activities in the Americas declined by 27.2% to USD 29.4 billion in Q3 2022, compared with USD 40.3 billion in Q2 2022.

Figure 4: DCM Quarterly Deal Volume

(Deal Value in USD billion)

Source: Refinitiv Deals Intelligence

The value of equity-raising activities in the Americas decreased by 58.8% to USD 2.7 billion in Q3 2022, from USD 1.7 billion in Q2 2022. The downside was primarily driven by a significant decrease in equity-raising activities in the discretionary and retail segments. High inflation, rising interest rates, and an uncertain economic scenario have also slowed down IPO activities.

Figure 5: ECM Quarterly Deal Volume

(Deal Value in USD billion)

Source: Refinitiv Deals Intelligence

Most players in the capital and debt markets are trying to gauge the causes and intensity of the speculated global economic recession. We expect the markets to be volatile as the Federal Reserve continues its quantitative tightening program.

The Road Ahead

The consumer and retail sector will likely continue showing a soft trend due to major economic headwinds including, inflation, rising interest rates, and global geo-political crises. However, we expect consumer demand to remain positive over the next few quarters.

M&A activities are expected to remain subdued due to market volatility, particularly listed companies that have recently undergone price corrections. However, small consumer companies with solid product pipelines are likely to remain attractive to companies and sponsors.

The debt markets may struggle in the near term, as economic headwinds will likely keep issuers on the sidelines, and investors are expected to demand higher returns on riskier assets.

About Evalueserve

Evalueserve combines insights emerging from data and research with the efficiency of digital tools and platforms to design impactful solutions. A global team of 4,000+ experts collaborates with clients across

15+ industries.

Evalueserve’s Corporate and Investment Banking practice works with bulge bracket banks, commercial banks, and boutique advisory firms. Our key practice areas include Sector and Product support, Lending & Credit support, Business Information / Library Services, Presentation Support services and Business Reporting. Our proprietary technology platform helps streamline and automate workflows, re-use work products through knowledge management and automate repetitive tasks. For more information, please visit:

Connect with us on LinkedIn

Vivek Sharma
Vice President, Corporate and Investment Banking LoB Posts
Saurabh Aggarwal
Senior Research Lead, Corporate and Investment Banking LoB Posts
Gulzar Siraj
Senior Research Lead, Corporate and Investment Banking LoB Posts

Latest Posts