Mergers and Acquisitions Outlook Brightens

Surge in Deal Activity Anticipated

The mergers and acquisitions (MA) market is poised for a strong year in 2024, with a sharp jump in deal activity expected, especially for larger deals. This brighter outlook is a stark contrast to the challenges faced by the MA industry in 2023, which was marked by economic uncertainty and regulatory headwinds.

Key Trends Shaping the MA Landscape

The KPMG 2024 MA Survey reveals that a majority of executives anticipate a surge in MA activity in 2024, with 75% planning to complete at least one deal. This optimism is driven by several key trends:

• Stabilizing macroeconomic climate: Economic growth is expected to moderate in 2024, providing a more stable environment for dealmaking.
• Returning confidence: Executives are regaining confidence in the MA market, after a period of uncertainty in 2023.
• Strategic imperative: Companies are increasingly recognizing the strategic benefits of MA, such as growth, market expansion, and cost reduction.

However, dealmakers remain cautious due to lingering concerns about inflation, monetary policy, and regulatory compliance. To mitigate these risks, executives are emphasizing:

• Thorough due diligence: Buyers are conducting more comprehensive due diligence to identify potential risks and opportunities.
• Innovative deal structures: Creative deal structures are being used to overcome regulatory challenges and achieve desired outcomes.
• Strong governance: Companies are prioritizing strong corporate governance practices to ensure transparency and compliance throughout the MA process.

The upcoming surge in MA activity presents both opportunities and challenges for dealmakers. By embracing these key trends and navigating the evolving regulatory landscape, companies can position themselves for success in the 2024 MA market.