2024 M&A Mid-year survey: Feeling bullish again
Dealmakers are increasingly becoming more optimistic about M&A.
For more than two years, the merger and acquisition (M&A) market has struggled to break out from a slump. But signs of a turnaround are mounting, and the results of the latest KPMG M&A survey add to the evidence. More than half (54 percent) of 200 US dealmakers we surveyed in mid-June 2024 expects deal count for this year to outpace last year’s volume. For next year, an even bigger majority (57 percent) believe deal count will keep rising and be higher than in 2024.
Private equity firms are more likely to anticipate increasing deal volume in 2024 compared to last year.
Expected Deal Volume in 2024 Compared to 2023
The most optimistic are private equity (PE) firms: 70 percent expects more deals in 2024 than in 2023, while 49 percent of corporates said the same. PE firms are still more bullish about the outlook for 2025, with 84 percent anticipating more deals in 2025 than 2024 compared with 48 percent for corporates. Transformational deals—M&A that changes the very nature and operations of a company—are the most sought-after type of transactions for all respondents. Looking ahead to 2025, 58 percent of PE firms and 52 percent of corporates said they plan to pursue at least one strategic transformational M&A. In comparison, 36 percent of PE firms and 29 percent of corporates will focus on bolt-on acquisitions.
Both corporate and private equity firm are aligned with their 2025 plans to pursue at least one transformation deal.
Survey respondents said shifting business valuations (59 percent), interest rates (58 percent), and inflation (56 percent) have the biggest impact on dealmaking currently. On interest rates, 64 percent said even a decline of 25-50 basis points would spark more deals. At the same time, 60 percent of PE firms also cited antitrust regulation as a top factor in whether to buy or sell businesses, while 51 percent of corporates said increased competitive pressures are influencing their decision-making.
Shifting business valuations and interest rates given as most impactful on desire to do a deal.
Top Market Conditions Impacting Desire to Buy or Sell Business
Meanwhile, geopolitical issues (e.g., conflicts in Ukraine and Gaza, China-Taiwan tensions) are affecting M&A plans, with 38% saying geopolitics has increased or brought forward their M&A plans. As for generative artificial intelligence (GenAI), 64 percent of PE firms said part of their AI strategy includes buying new GenAI technology through acquisitions, but corporates (44 percent) are more likely to use the technology in their dealmaking process than buy new GenAI products through M&A (41 percent).
For more on our survey results, download the full PDF.
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KPMG M&A Deal Market Study
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