North American M&A transaction volume continued to increase quarter over quarter while aggregate deal value declined for the overall market. Strategic acquirers once again dominated the market with higher borrowing costs causing activity to favor volume over deal size. With the market showing signs of a mild recovery after a challenging 2023, the anticipated rate cut by the Federal Reserve in September 2024 is expected to produce more sponsor-led acquisitions. Despite suppressed levels of sponsor-led activity, record amounts of dry powder are ready for deployment in the marketplace. Rising transaction multiples, elevated levels of dry powder, and the expectation of declining … [Read more...]
M&A Quarterly Update: 2024 First Quarter
North American M&A activity was slow in Q1/2024, as inflation remained higher than expected and interest rate cuts continue to be pushed further into the future. Significant private equity dry powder remaining has kept sponsor M&A activity above pre-COVID levels, and there were some promising year-over-year trends in certain sectors. However, a full market recovery is not expected until inflation moves closer to the Fed’s 2% target and monetary policy eases. … [Read more...]
M&A Quarterly Update: 2023 Fourth Quarter
The North American M&A market wrapped up a slower year in Q4/2023. Persistent inflation, elevated interest rates, geopolitical concerns, and general economic uncertainty continue to pose challenges for the market. However, quarter-over-quarter growth in deal value is a promising sign into 2024. With the possibility of easing monetary policy over the next year, combined with significant private equity dry powder remaining to be deployed, there is hope that dealmaking activity could be poised for a rebound in 2024 as the economy improves. … [Read more...]
M&A Quarterly Update: 2023 Third Quarter
The North American M&A market continued to decline in the third quarter of 2023 as dealmakers remained hesitant given the lingering macroeconomic uncertainty and geopolitical concerns. High funding costs drove down financial sponsor activity, with PE firms looking beyond traditional LBOs to get transactions done. Bank M&A was also slow this quarter, although other areas of the financial services sector began to show signs of life. Despite the sustained M&A slowdown, significant dry powder remains in the private equity market, with U.S. corporations holding significant cash balances, giving some experts hope that dealmaking activity could be poised for a rebound as … [Read more...]
M&A Quarterly Update: 2023 Second Quarter
M&A activity decreased further in the second quarter of 2023. Higher interest rates, tighter credit availability, and general economic uncertainty continue to pose headwinds for dealmaking across sectors. The financial services industry saw another drop in volume as companies focused on core business strategy. Private equity activity also slowed further as financing costs remained high. Despite the persistent challenges facing the M&A market, there is cautious optimism that activity could pick up as firms look to capitalize on lower valuations and financial sponsors seek to deploy significant dry powder. … [Read more...]
M&A Quarterly Update: 2023 First Quarter
M&A activity declined in the first quarter of 2023 as high inflation, additional interest rate increases, and concerns over a potential recession contributed to significant uncertainty in the market. In addition, multiple bank failures put pressure on the financial services sector, prompting banks to shift their focus internally to ensure stability. As lenders hesitate to provide capital, the broader M&A market could face an additional slowdown over the coming months as potential buyers struggle to find sufficient acquisition financing. … [Read more...]
M&A Quarterly Update: 2022 Fourth Quarter
M&A activity in the fourth quarter of 2022 increased slightly but remained down from its record levels in recent quarters. Rising interest rates, high inflation, and volatile equity valuations will continue to pose headwinds for the M&A landscape heading into 2023. Alternative funding sources are gaining popularity as the cost of capital continues rising, and diligence standards are becoming more stringent as acquirers search for maximum value. … [Read more...]
M&A Quarterly Update: 2022 Third Quarter
M&A activity in the third quarter of 2022 slowed from its record levels in recent quarters. Global economic uncertainty driven by rising interest rates, high inflation, and volatility in the equity markets will continue to pose headwinds for the M&A landscape for the remaining months of 2022 and into early 2023. As the cost of capital rises, smaller deal sizes and alternative funding sources are becoming more popular as both sponsors and strategics search for new ways to create value. … [Read more...]
M&A Quarterly Update: 2022 Second Quarter
Following a year of record M&A activity, the second quarter of 2022 finished strong compared to historical trends. Substantial liquidity among strategics, private equity firms, institutional investors, and SPACs is driving up transaction multiples. Global economic uncertainty driven by rising interest rates, supply chain challenges, labor shortages, and volatility in the equity markets continues to pose headwinds for the M&A landscape for the remainder of 2022. … [Read more...]
M&A Quarterly Update: 2022 First Quarter
Following a year of record M&A activity, the first quarter of 2022 finished strong compared to historical trends. Substantial liquidity among strategics, private equity firms, institutional investors, and SPACs is driving up transaction multiples. The average Enterprise Value / EBITDA was 24.9x, rivaling the second quarters of 2021 and 2019, both well above average. Multiples in this range indicate we are still in a seller’s market. Global economic uncertainty driven by rising interest rates, supply chain challenges, labor shortages, military conflict, and volatility in the equity markets continues to pose headwinds for the M&A landscape for the remainder of 2022. … [Read more...]
M&A Quarterly Update: 2021 Fourth Quarter
Welcome to the quarterly M&A update for 2021. This Quarter Report analyzes data from the fourth quarter of 2021. North America M&A activity continued at a rapid pace in the fourth quarter of 2021. More than 5,300 deals closed for a combined $843.41 billion transaction value in the quarter, setting both a deal count and value record. As of December 31, an estimated 18,538 deals have been completed in 2021 for a total value of $2.75 billion. This is an increase of $507.65 billion in deal value recorded compared to 2020. … [Read more...]
M&A Quarterly Update: 2021 Third Quarter
Welcome to the quarterly M&A update for 2021. This Quarter Report analyzes data from the third quarter of 2021. North America M&A activity continued its bull run in the third quarter of 2021. More than 4,600 deals closed for a combined $708.3 billion transaction value in the quarter, setting both deal count and value on track to exceed the previous annual record. As of September 30, an estimated 12,855 deals have been completed in 2021 for a total value of $1,863.9 billion. This is an increase of $802.4 billion in deal value recorded for the same period in 2020. … [Read more...]
M&A Quarterly Update: 2021 Second Quarter
Welcome to the quarterly M&A Update for 2021. While several proposed regulatory and tax policy changes under the Biden Administration, such as a new executive order that ratchets up antitrust scrutiny in financial services, healthcare, transportation, and other industries, may negatively affect M&A activity, the current deal flow through the first half of 2021 remains robust. … [Read more...]
M&A Quarterly Update: 2021 First Quarter
Welcome to the quarterly M&A Update for 2021. With a quick vaccine rollout, uncertainty is beginning to subside, and the combined number of announced and completed deals is reaching record levels. … [Read more...]