There is expected to be more take over activity in the food supply industry, as pressure for consolidation remains in what is seen as a high-growth sector.
Last week, the Australasian food group, Food Holdings said it intended to buy the operations of recently listed Cooks Food Group for $4 million.
Cook Food Group chairman Keith Jackson says food companies are good businesses that deliver stable earnings as people need to eat.
He says a lot of consolidation can take place in the food sector and food stocks are quite stable in the current climate.
Cameron Partners directors Hugh Cotterill says consolidation started as a counter to the power of the two Woolworths and Foodstuffs supermarket groups.
There were 16 transactions last year, including the sale of fruit syrup maker, Baker Hill to Coca Cola Amatil, Frucor to Suntory, and deals involving Open Country Cheese, Mr Chips and Mother Earth.
Mr Cotterill says he thinks the recession may hasten further takeover activity, rather than dampen it.
He says a company facing lower demand for some of its products, as well as increasing price pressure, and too much debt might bring forward plans to exit the industry.
Mr Cotterill says a recession makes buyers focus on what is core strategy and to sell what's unnecessary.
But he says there is still a major value in brands, so a company may choose to acquire additional brands to an existing portfolio.
Mr Cotterill says trade buyers are dominating activity in the sector, rather than private equity firms.
