Global M&A Industry Trends: 2024 Mid-Year Outlook

Despite a rocky start in 2024, M&A activity is poised for a comeback. Our latest Global M&A Industry Trends report sheds light on the prevailing market conditions and the factors that could help revive dealmaking.

The deals imperative

Private equity (PE) portfolios are ripe for sale, with about 50% of the 27,000 global portfolio companies held for over four years. Corporates are looking at transactions to accelerate growth and achieve transformation in a disruptive environment.

AI is emerging as a catalyst for various transaction types, potentially transforming sectors and entire industries. Companies are increasingly relying on M&A to counter sluggish organic growth.

Current market performance

M&A deal volumes fell by 25% in the first half of 2024 due to prolonged high interest rates. However, deal values rose by 5%, buoyed by significant transactions in the technology and energy sectors.

Megadeals, defined as transactions worth $5 billion or more, saw a 16% increase, with 35 such deals announced in the first half of 2024. Corporates now account for 63% of M&A activity, a 3% increase, while M&A involving financial sponsors dropped by 34%.

Obstacles to M&A recovery

Dealmakers face several challenges, including high interest rates, fluctuating valuations and geopolitical uncertainties. Resolving these issues could significantly boost market activity.

Market signals

Several indicators can guide dealmakers:

• Exit pressure is rising, with a narrow IPO window in 2024 due to UK and US elections.

• Debt and financing for M&A could nearly double compared to 2023, with strong issuance activity in US and European high-yield bond and leveraged loan markets.

• Private capital continues to grow, reaching approximately $13 trillion in assets under management globally.

• Investment in the energy transition will require both public and private capital.

• Corporates are transforming their operating models to address technological disruption, leading to both acquisitions and divestitures.

• Restructuring and distressed M&A will offer opportunities to fill gaps in competencies and geographies.

Key actions for dealmakers

For buyers, success hinges on a strategic focus on AI, data analysis, talent, sustainability and the equity story. On the other hand, sellers need to conduct strategic reviews, prepare thoroughly for sales, and support transactions with robust data.