Global M&A market dropped by 15%, the lowest in a decade!

Sep 30, 2024

By: Prerna Tyagi

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Bain's M&A report

In 2023, the global M&A market dropped by 15%, reaching $3.2 trillion—its lowest level in a decade. Buyers and sellers were hesitant, waiting for each other to make the first move, and strategic deals fell by 6%. Explore more such insights, based on Bain’s M&A Report:

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Key challenges in 2023​

The main challenges? High interest rates, mixed economic signals, regulatory scrutiny, and geopolitical risks. These factors contributed to delayed deals and the lowest deal multiples in a decade.

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​Sector-specific impact​

While tech M&A dropped significantly, healthcare and life sciences, along with energy and natural resources, experienced a rebound. These sectors drove much of the M&A activity in 2023.

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The valuation gap​

The biggest obstacle? The valuation gap between what buyers wanted to pay and what sellers expected. This led to stalled negotiations and, in some cases, abandoned deal processes.

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​Strategic M&A in 2023​

Even with the market slowdown, strategic M&A saw over 27,000 deals valued at $2.4 trillion. Corporate buyers, unlike private equity, had stronger balance sheets, allowing them to proceed with acquisitions.

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​Frequent acquirers outperform​

Frequent acquirers, those who consistently make deals, continued to outperform their inactive peers in 2023. These companies used M&A to expand their competitive advantage during challenging times.

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​Industry-specific moves​

Automakers, insurers, and media companies made deals to secure their future. From electric vehicle infrastructure to media consolidation, vertical dealmaking dominated.

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Mega deals in the second half of 2023

Largescale deals picked up in the second half of 2023, signalling that dealmakers were starting to look beyond the economic downturn and positioning themselves for long-term trends.

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Regulatory scrutiny on the rise​

Regulatory bodies across the globe, including the European Commission and the US Department of Justice, increased scrutiny on major mergers, especially in tech and healthcare.

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​Cross-border M&A activity​

Despite a tough year, cross-border dealmaking remained resilient. US buyers pursued more international deals, and regions like Brazil and Asia attracted foreign investment.

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Winners of the M&A downturn​

The companies that stayed active in M&A, using well-tested strategies, are expected to emerge as industry leaders, reinforcing the benefits of frequent dealmaking.

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