News built for finance pros
CFO Brew helps finance pros navigate their roles with insights into risk management, compliance, and strategy through our newsletter, virtual events, and digital guides.
Early this year, experts predicted the market for M&A was prime for a turnaround after a slow 2023, but so far the results have been kind of…meh.
The so-so M&A results—deal volume was down, but deal values were up—has the folks at PwC in a US deals midyear outlook urging business leaders to “accept the new reality instead of wishing for a return of low interest rates,” as their “fixation on potential interest rate cuts” hasn't done the M&A market any favors.
PwC found that M&A deal volume has remained “roughly flat” since leveling off the latter part of last year. Overall deal value in the first five months of 2024, meanwhile, was up almost 30% year over year.
The time is right. According to PwC, indicators like “strong corporate profits, rising executive confidence and stabilizing inflation” mean the timing is right to execute a deal.
Dealmaking might also be imperative for the survival of some organizations. Citing its latest Pulse survey, the firm noted that more than four in five US chief executives say the average business in their industry will fade away in the next decade if it doesn’t evolve its business model. What’s more, more than a third of CEOs said companies won’t still be in business in three years if they don’t change.
“With a fledgling M&A recovery already underway, companies that stay on the sidelines risk being left behind,” according to the report. “Despite the need for change, many companies haven't adjusted their strategic priorities to reflect the beginning of an M&A recovery.”
The survey reflected that hesitation: only 28% of respondents said they were anticipating engaging in M&A activity within the next 18 months.