Market analysts with Cascadia Capital believe pet food mergers and acquisitions may be entering a new phase after three years of relatively muted activity. Deal volume remains below the record pace seen in the early ‘20s, but that was likely a phenomenon related to the pandemic. Now, though, the market may become more active as sponsor-backed companies reach the end of typical private equity holding periods and strategic buyers look for new sources of growth.
According to Cascadia Capital's Pet Industry Insights: Summer 2026 report, mergers and acquisitions are "heating up" in 2026 following several years of limited activity. The firm attributes the improving environment to greater operating visibility, abundant private equity capital and a growing number of portfolio companies becoming ready for liquidity events after five or more years of ownership.
The report identifies several transactions that signal renewed momentum, including Agrolimen's acquisition of fresh pet food brand Ollie, Encore Consumer Capital's investment in Brutus Broth, Pure Treats' acquisition of Primal Pet Foods and "I and love and you"'s acquisition of premium cat food company Made by Nacho. Cascadia also notes that companies including Honest Kitchen, Nulo, Stella & Chewy's and Weruva are expected to attract acquisition interest, while Open Farm is exploring a public listing.
Activity rebounds after a multiyear slowdown
The renewed optimism follows a prolonged slowdown in pet industry dealmaking.
According to Petfood Industry's tracking of announced transactions, the industry recorded 23 mergers and acquisitions during 2025, down from 26 in 2024 and well below the 48 to 58 annual transactions reported during the peak years of 2020 through 2022. Analysts attributed the slowdown to higher interest rates, valuation gaps and broader economic uncertainty, even as investor interest in the sector remained strong.
Rather than disappearing, acquisitions became more selective. Buyers increasingly focused on businesses with demonstrated profitability, differentiated products and resilient consumer demand instead of pursuing growth at any price.
Consumables remain the industry's most attractive assets
Both Cascadia and Petfood Industry identify consumables, including pet food, treats and supplements, as the most sought-after acquisition targets.
The investment bank notes that food, treats and supplements continue attracting institutional investors because they generate recurring purchases, strong customer loyalty and pricing power. Those characteristics have become increasingly valuable as companies seek predictable revenue growth in a more uncertain economic environment.
Private equity prepares for exits
Private equity is expected to play an increasingly important role in the next wave of transactions.
Many pet food companies acquired during the investment surge of the early 2020s are now reaching the end of typical ownership periods, creating pressure to pursue sales or alternative liquidity strategies. At the same time, buyers remain disciplined on valuation, rewarding companies with strong margins, operational resilience and clear competitive differentiation.
Some firms are also exploring continuation funds and other financial structures that allow investors to retain ownership of high-performing assets while providing liquidity to existing investors. Those approaches could complement traditional acquisition activity as the market evolves.
The next phase of pet food mergers and acquisitions may be driven by targeted investments in premium nutrition, fresh food, supplements and cat-focused brands.
