Welcome to the latest edition of KPMG’s Nordic Deal Trend Report covering deal activity in our part of the world in the second quarter of 2022. While the summer holidays are upon most of us – or approaching fast – it is a good time to reflect on what has happened in the M&A market and the world around us in the first half of the year. And to contemplate what might come in the next couple of quarters.

Even though, across the Nordics, we have emerged from a couple of years’ COVID headwind in remarkable shape – especially last year was out of the ordinary when zooming in on the M&A activity levels – the big question is now to which extent we will see a long-lasting effect of Russia’s war on Ukraine.

Looking at deals in our region, 564 were announced in Q1 2022. This is almost at par with the same period last year and above the 483 announced in Q4 2021. In Q2 2022, the M&A activity seems to continue with 519 deals being announced.

Sector breakdown by deal count Q2’22 vs. Q1’22

Nordic deal trend report

Nothing much is changing when looking at composition of deals per industry. Technology, media & telecommunications and manufacturing & industrials still take the top-two spots of our sector heat chart with 26 % and 19 %, respectively. One interesting thing worth noting, however, is that construction & real estate has left its top-three spot and has fallen down the list. Expectedly, this could be a sign of the effect we alluded to in our most recent report that we will start seeing increasing inflation and rising interest rates having an impact on, at least, some parts of the M&A levels.

When it comes to predicting how M&A activity will fare across the Nordics in a near future, we have a daunting task on our hands. Companies spent the past couple of years trying to address supply chain issues caused by trade tensions and the global pandemic. While some pandemic-related problems have abated, continuing lockdowns in China have resulted in supply chain backlogs. Russia’s first quarter invasion of Ukraine worsen the problem, which in turn helped drive inflation higher in the Nordics and rest of the world.

No doubt, we will still follow with some level of anxiety how the near future impact of war, energy costs and supply-chain disruption will affect deal making appetite across the Nordics.

Uncertainty is challenging for us all to navigate – we look forward to supporting our clients and working alongside to address these considerations in their deal processes.

Have a good summer  !