Cold Storage Transportation Finance

In our update on the Cold Storage sector, we uncover the trends driving M&A activity and valuations as investor demand grows and large consolidators look to expand their footprints.

• Supply/demand imbalance of cold storage – Growing consumer demand and shifting supply chains are outpacing cold storage supply, fueling consolidations by larger providers in the market
• Large food-related businesses prefer fewer providers – Large grocery chains and food service distributors prefer working with fewer providers, leading to a concentration of demand for top cold storage networks that are reliable and easy to use
• Shifting supply chains – As consumers purchase more groceries online, distribution networks are shifting to move locations closer to suppliers and customers
• Resiliency – Given the recession-resistant nature of the sector, investors view cold storage as a safe place for their capital, which is driving up valuations
• Low cost of capital and investor appetite – Low interest rates and more available capital is benefiting the largest providers and accelerating M&A activity