The number of merger and acquisition deals in the U.S. distribution sector dropped sharply in the second quarter of the year, according to the latest analysis from investment bank PMCF.
Analysts wrote in the bank’s latest “Distribution M&A Pulse” report that 65 distributor M&A deals were completed in the U.S. in the April to June window, down from 106 in the same period of 2024.
PMCF officials wrote that the decline underscored “near-term impact of macro and policy headwinds” as many companies opted to shift from acquisitions to “operational improvements and organic growth” in an era of “tariff-related uncertainty.”
Amid the overall decline, however, demand for “high-quality assets” remained high, analysts suggested, after the average size of distribution transactions soared year-over-year. The average deal came in at $275 million in Q2; in the previous second quarter, the average price was $53 million.
Companies sought to “invest selectively in attractive businesses despite the challenging macroeconomic environment,” analysts found, adding that the industrial production index trended higher in the U.S.
“Notable transactions, such as the $600M KCG-Foundation Building Materials merger, emphasized ongoing appetite for companies with durable cash flows and strategic positions in desirable sectors,” PMCF analysts wrote.
Worldwide, the analysis found that 149 distributor deals closed in the second quarter.
