Global Mergers and Acquisitions Trends in 2024

Global mergers and acquisitions are an crucial to the many corporate strategies to grow. They provide access to new markets and industries, customers, products and technologies. They also boost financial power through increased the size and reach. Companies must take into consideration straight from the source a range of factors prior to making international acquisitions or divestitures. These include taxation, regulatory concerns and cultural differences.

In 2024, the uncertainties of the capital markets and uncertain macroeconomic situations caused a lot of deal activity. We anticipate M&A activity to pick up in 2024, as capital markets and macroeconomic conditions improve.

M&A can be driven by other strategic objectives such as consolidation or digital innovation. AI, predictive robots, and smart factories, for example are boosting efficiency in manufacturing in the industrial sector.

To expand the market and increase customer base, it’s important to purchase companies offering similar products or service across different geographical markets. This is known as market extension. A good example of this is when PepsiCo bought Pizza Hut to significantly boost its sales of soft drinks.

M&A trends include a shift towards reducing the risk of geopolitical instability by focusing on markets with better outlooks, investing vertically, and enhancing the resilience of supply chains. As cash and debt become more scarce, we expect buyers to utilize complex structures, such as stock exchanges, minority stakes sales, as well as earnouts, to bridge gap in valuation. This could include using private equity funds to make the deal feasible.