For years, acquisition activity in the label space has been driven by financial sponsors. The serial acquirers of the 2000s, including privately-held companies and corporations such as CCL and Multi-Color Corporation, ceded acquisition leadership to private equity sponsors since the mid 2010s. Sponsor-led consolidation in labels surged from 2018–2022, peaking in both valuation and deal volume. While platform count remains high, add-on activity and pricing have softened, signaling a shift toward exits and secondary buyouts. Combined, LBO Platforms and Platform Add-ons accounted for 74% of 432 acquisitions tracked for 2018 through 2025. 

Sponsors were attracted to labels because of: the fragmented competitive base which provided opportunity for consolidation; low capital intensity relative to other forms of packaging and the resulting robust cash flow; “stickiness” of customers (a result of lower cost relative to other packaging and product value); and resistance to low-cost import competition.

By nature, sponsors are “herd animals,” and when they see success by a competing sponsor in an industry, they follow. This led to an unprecedented number of rollup platforms and M&A activity in the label market, which appears to have peaked in 2021-2022. The subsequent fall off in activity begs the question of whether this is a temporary softness or a sign that the herd may be seeking new pastures. We reviewed the data for clues.

Our analysis identified 62 sponsor-backed platforms that were active from 2018 to 2025.  As sponsors enter and exit the market, in any given year the number of active platforms was less. In 2018, there were 23 active platforms; this ballooned to 40 in 2021. In December 2025, there were 45 active platforms. This indicates no lagging of interest in the space, and indeed, label M&A remained vibrant in 2025.

A closer look, however, indicates that a transition is occurring.

The Pace of Add-Ons

The pace of add-ons to sponsors’ platforms peaked in 2021 and 2022 and fell by ~40% to 2023-2025. 

There can be no doubt that as the number of sponsors investing in the space proliferated, competition for assets pushed acquisition prices to a level that may have dissuaded certain buyers from transactions. Indeed, we noted pricing (measured as a multiple of EBITDA) peaked in 2020-2021 at an average 2+ turn premium to historical averages. Consider as further evidence that CCL Industries, a strategic acquirer which long publicized its acquisition multiples typically at 5x EBITDA or less, curtailed activity during this period. This pricing shift is important in that the availability of affordable add-ons in the space has been a key driver in sponsor-led investment. If you take away that leg, the table can get wobbly. 

Moreover, there is evidence that some sponsors were priced out of the market. The top five most active rollups accounted for 1/3 of all add-ons, pricing out the remaining platforms from many transactions. A result: nearly 1 of 5 sponsors have had no add-ons. 

Age of Platforms

Another interesting finding is that the average age of platforms has steadily crept up since 2022: 

This has produced a universe where 71% of these platforms are aged 5+ years, including 21% at 7+ years. This is important as the average private equity holding period is five to seven years. In general, longer hold periods mathematically yield lower rates of return (IRRs), a key metric by which sponsors are measured. With 71% of platforms “aging out” and lowering IRRs, there is a significant urgency for sponsors to exit.

Sponsors with older vintage platforms will be looking to exit their investments as soon as they reasonably can. The challenge will be that a market that does not provide affordable add-ons and/or has longer hold periods generates a lower return for sponsors. This would reasonably lead to a less attractive market for new sponsor entrants and dampen future pricing in the market.

What form will this liquidity take? 

It does not appear that there is a home for these assets beyond financial sponsors. Apart from CCL, the public markets have not shown tremendous interest in a label-focused company. As noted above, CCL has curtailed label acquisitions, and the other publicly-traded label converter, Multi-Color Corporation, was itself taken private by Platinum Equity in 2019. Also, larger diversified packaging conglomerates do not yet have interest in labels. Consider the exception of Constantia, which spun off its label operations in 2017 after being sold to financial sponsor Wendel in 2015. This leaves a selling sponsor with two options: become an add-on to someone else’s platform or trade as a “secondary buyout” to another financial sponsor. This is borne out in the data, as exits since 2018 have exclusively been add-ons (5) and secondaries (12).

Planning for 2026+

It feels like we reached “peak label M&A.” What do we expect in 2026?

• Expect more pricing discipline in M&A. The rush to consolidate as many independents as possible pushed valuations to a peak in 2021, with valuation multiples since trailing off to under 7x EBITDA. Longer hold periods and a more sober view on value should keep valuations closer to this range going forward. Also, expect the universe of “consolidators” to itself consolidate over time. With the pressure to realize a return, exits will be to other consolidators or a secondary buyout to another financial sponsor. As rollups themselves are consolidated and overall become bigger, they will require larger transactions to move the needle and justify the effort for an acquisition. 

• Operationally, larger rollups such as Resource Label Group, MCC Label, Asteria, etc. now represent a larger, more meaningful share of the market. Well-managed larger companies should be able to drive efficiencies (at least for the largest customers) and to make investments in innovative technologies. Plus, there were several platforms in the label space that we excluded from our deep-dive analysis but that present intriguing strategies for building value. These include acquirers of materials-focused targets (e.g., Fedrigoni (Bain Capital)); distributors (e.g., Novvia (Kelso)); equipment manufacturers acquiring consumables (e.g., ProMach (Leonard Green)); and industrial / supply chain models (e.g., Peak Technologies (Sole Source Capital)). Investors in the space can build value by pursuing acquisitions with strategies other than a consolidating rollup.

• We have seen the sponsor universe begin to shift its rollup focus away from labels to “the next hot thing” (we anticipate that is distribution, which has seen a noticeable uptick in deal activity over the past three years). If you are a sponsor in the label market, consider trying to be at the front end of a transition. 

• Keep perspective. The underlying dynamics of the label market that drew investor interest are still there. A resilient appetite for these assets will remain.

Jonathan White is a managing director at Mazzone & Associates, advising clients on transactions in the label industry and across the broader paper, plastics, and packaging markets. A frequent speaker at industry conferences, he brings deep sector knowledge and practical transaction experience informed by senior roles in investment banking, corporate development, and operations.