The Top 2024 M&A Markets for Growth — and Why
The Bear Maybe Heading Back into Its Cave
As industry professionals will already know, the past few years have been something of a roller coaster for global M&A:
- The 2020 pandemic year saw an initial decline in activity but rebounded in the second half with significant valuation increases and deal volume.
- That set up the industry for a record-breaking 2021 that saw $6 trillion in M&A, with steep increases in values and the United States’ share of global deals.
- Things changed in 2022, with the industry seeing historically low numbers across transactions and deal values as well as equity issuance.
- The following year continued this downward trend, with values, volumes, and transactions further declining in 2023 over 2022.
Halfway through 2024, the industry is expected to climb out of the valley of the past two years. Looking at Q1-24 alone, global deal values saw an increase of 36%, and many believe that volumes could rebound by as much as 50%. A number of industries are leading the way around the world, and for different reasons. Here, we’ll explore the top 2024 M&A markets and what’s helping to move them forward.
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The Top 2024 M&A Markets Seeing Significant Movement
Industrials
Following a slightly cooler 2023, industrial organizations are among the most bullish with 54% of mid-market industrial companies expecting valuation increases this year. While interest rates, geopolitical issues, capital access, and more slowed this sector down last year, executives are targeting this market even more this year, with 65% reporting these company types as among the top targets in their acquisition strategy.
Technology
While 2023 saw a sharp decline in technology M&A, the market is now set for a strong rebound as one of the top 2024 M&A markets. The explosive growth of AI and other aspects of technology are leading the way, with the number of AI deals increasing by more than 20 times between 2022 and 2023 according to S&P Global. Additionally, 80% of dealmakers expect activity to increase in this market, led largely by corporate acquirers rather than private equity firms or other acquirer types.
Healthcare
With the healthcare market having been in a challenging position over recent years, it’s good to see this sector seeing a resurgence. In Q1-24, healthcare saw more deal activity than in the first quarter of the past three years. With many institutions being in financial distress, and many others looking to offset the challenges of recent years through opportunistic acquisitions, big players are acting — looking to supplement their portfolios and even make cross-market moves that won’t cause regulatory delays or issues.
What Does the Rest of the Year Hold?
The above industries are just a sampling of the many that are currently experiencing strong performance thus far in 2024. Many subsectors of these high-level markets are also experiencing comebacks, such as software, life sciences, health tech, cybersecurity, managed security providers, integrators, manufacturing, warehousing, storage, and so on. But what about the rest of 2024?
Analysts and experts across the industry expect that deal flow will be stable throughout the second half of the year. U.S.-based corporate M&A deal volume is expected to increase by 20%, and private equity deal volume is expected to grow by 16%. Ultimately, the top 2024 M&A markets will lead a steady return toward pre-2023/2022 M&A activity.
Let the Mid-Market Experts Support Your M&A Strategy
Whether you’re looking to make a strategic purchase to grow your competitive advantages, are looking to divest a portion of your business that no longer aligns with current goals, or are looking to sell the business you’ve spent your career building, our team is here to help.
Serving as the exclusive investment banker for countless companies on both sides of the deal table, MelCap Partners brings the personalized service and relationship focus you need to navigate one of the most important transactions of your career. We’ll work closely with you from beginning to finish, ensuring you’re protected and that the fruits of your effort are maximized.
Connect with us today to learn more and to discuss your M&A needs.
