Dealmakers chose smaller targets to strengthen supply chains, implement and secure new technologies, and comply with ESG initiatives
Sharply rising interest rates have already tamped down the overall volume and value of M&A transactions, a trend likely to continue for the next few quarters as a global recession looms.
For the foreseeable future, mega-mergers are likely to remain on pause. According to KPMG Economics, as central banks strive to keep inflation at manageable levels, any dealmaking in the next 12 months is likely to be on a smaller scale as players look to leverage new technologies.
M&A transactions that backfill or plug gaps are smart, strategic moves and small enough to be achievable in this environment. The continuing need for more resilient supply chains presents opportunities for small-scale deals that augment vertical integration—for example, to ensure sources for electric vehicle (EV) battery materials or fleet maintenance and repair services.
Biding time - M&A trends in Industrial Manufacturing
Download PDFWill M&A gain more traction in 2024? Q4'23 M&A trends in IM
Industrial manufacturing M&A is expected to revive in 2024. Discover the key trends that are driving a positive shift in the industry.