LONDON, December 19, 2022 — The global M&A market has remained remarkably resilient against a year of unprecedented uncertainty. Latest M&A research by WTW (NASDAQ: WTW) showed buyers outperforming the wider market1 as recently as the third quarter of 2022, based on share price performance of completed deals.
However, deal volume has slowed significantly compared to the record pace set last year. Multiple factors have weighed on M&A in 2022 - geopolitical turmoil, soaring inflation, rising interest rates and fears of a global recession - that will continue into next year. Such a challenging economic backdrop makes it harder for buyers, particularly those venturing beyond their own borders, to confidently predict the profitability of potential targets.
“An unprecedented number of disruptive forces have created headwinds for dealmakers, but they are also generating opportunities,” said Gabe Langerak, Head of Corporate M&A Consulting Europe. “The fundamentals that drive dealmaking are still in place and, with valuations moderating after the historic levels reached in 2021, strategic and financial buyers alike will take advantage of better-priced opportunities for growth.”
5 M&A trends for 2023
Gabe Langerak shares his top trends for the year ahead:
Langerak said: “As we move into 2023, economic uncertainty will continue to define and challenge M&A activity, but there will also be opportunities. The same volatility will present its own impetus for dealmaking, as strategic buyers seek to capitalise on cut-price deals in order to combat current market challenges and realise transformational growth.”
As we move into 2023, economic uncertainty will continue to define and challenge M&A activity, but there will also be opportunities.”Gabe LangerakHead of Corporate M&A Consulting Europe
WTW QDPM Methodology
- All analysis is conducted from the perspective of the acquirer.
- Share-price performance within the quarterly study is measured as a percentage change in share price from six months prior to the announcement date to the end of the quarter.
- All deals where the acquirer owned less than 50% of the shares of the target after the acquisition were removed, hence no minority purchases have been considered. All deals where the acquirer held more than 50% of target shares prior to the acquisition have been removed, hence no remaining purchases have been considered.
- Only completed M&A deals with a value of at least $100 million which meet the study criteria are included in this research.
- Deal data sourced from Refinitiv.
About WTW M&A
WTW’s M&A practice combines our expertise in risk and human capital to offer a full range of M&A services and solutions covering all stages of the M&A process. We have particular expertise in the areas of planning, due diligence, risk transfer and post transaction integration, areas that define the success of any transaction.
About WTW
At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organisations sharpen their strategy, enhance organisational resilience, motivate their workforce and maximise performance.
Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you.
Footnote
1 The M&A research tracks the number of completed deals over $100m and the share price performance of the acquiring company against the MSCI World Index, which is used as default, unless stated otherwise.
