October 19, 2020

M&A Trends: Dealmakers Expect Return to Pre-Pandemic Activity Levels

According to Deloitte’s 2020 M&A Trends Survey, 61% of US dealmakers expect M&A activity to return to preā€“COVID-19 levels within the next 12 months. The survey polled 1,000 U.S. corporate executives and PE fund representatives in late August to assess their current and future M&A plans. Here are some of the other key takeaways:

– Given current economic and political uncertainty, 42% of survey participants indicate increased interest in alternatives to traditional M&A

– 33% of dealmakers surveyed are responding to structural sector disruption by accelerating long-term transformation of their business models as part of their M&A strategy in response to COVID-19

– Cybersecurity threats are top of mind for more than half (51%) of respondents as companies manage deals virtually

– The biggest challenges to M&A success are now uncertain market conditions, translating business strategic needs into an M&A strategy, and valuation of assets

– Interest in international dealmaking has declined; focus has shifted to domestic M&A opportunities

One of the survey’s more interesting findings is how dealmakers have reacted to the uncertainties surrounding the U.S. election. Approximately 25% of respondents said that uncertainty surrounding the election has slowed deal activity, while 23% said it has accelerated deal activity.

John Jenkins