Interview, Webinar
What’s Next for M&A?
- M&A activity is projected to maintain real momentum beyond the current year, with 2022 expected to reach on-par or potentially the highest rates seen in 2021, driven by client focus on long-term strategic visions spanning 5 to 50 years despite short-term macro challenges.
- Deal execution is anticipated to shift toward a greater number of larger transactions and expanded private equity involvement, which currently represents mid-30% market share and is expected to grow as sovereign funds, family offices, and institutional capital engage in direct controlling investments and partnership rollover structures, particularly in Europe.
- Cross-border activity is forecast to resume and expand following the loosening of U.S. travel restrictions, though new restrictions would significantly dampen this trend, while remote execution methods are expected to become a permanent feature that shortens transaction timelines.
- Structural shifts include a dramatic compression of technological transformation timelines from 20-30 years to five years or less, alongside persistent macro issues regarding labor rates and inflation that are viewed as long-term rather than cyclical.
- Key risks impacting execution and pace include pandemic growth resurgence potentially affecting only Q1, equity market volatility, a shifting regulatory environment, global instability, international relations issues, and domestic political polarization affecting CEO confidence.
- Future deal drivers encompass technology, ESG positioning, capital allocation scrutiny, and growth themes, with deal activity expected to remain resilient against potential Fed rate hikes due to debt costs remaining at relative historical lows.