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2022 M&A Trends Survey: The future of M&A

Dealmaking trends to help you pivot on M&A’s fast-changing playing field

The M&A market is hot, with current M&A trends indicating an upcoming run. But that doesn’t mean next year will come without challenges. Explore insights from corporate and private equity firm dealmakers that can help your company anticipate obstacles, adapt to evolving regulation, and innovate its M&A strategy.

Adapting, anticipating, and innovating

M&A executives are sending clear and strong signals that deal-making activity—acquisitions, divestitures, and alternative M&A strategies—will provide important levers for businesses as they continue to navigate regulatory tightening and an evolving economic environment.

Deloitte’s 2022 Future of M&A Trends Survey polled 1,300 executives at corporations and private equity investor (PEI) firms from August 26 through September 7, 2021 to glean insights about current deal activity and expectations for the next 12 months.

2022 M&A Trends Survey: The future of M&A

Key findings

Merger, acquisition, and divestiture activity

There is more to today’s M&A activity than just acquisitions. Divestitures are also on the rise, and more executives report they are open to alternative strategies.

  • 92% of respondents expect deal volume to increase or stay the same over the next 12 months.
  • 57% of corporate respondents have engaged in a divestiture in the past 12 months.
  • 32% of corporate respondents say they are considering a divestiture.

Challenges and solutions keep evolving

Corporate strategy, M&A strategy, and operating model limitations are continuing to intersect in different ways. Executives say aligning these forces into a coherent approach remains one of their greatest challenges. But there are new tools to help: digitally enabled, virtual, and hybrid management of the M&A process is more prevalent than before. So is interest in international deal-making.

  • 54% of responding dealmakers think the tightening regulatory environment will spur more deal activity, as they race to beat implementation of more challenging obstacles.
  • 68% say they are taking a greater interest in international deal-making over the coming year.

Transformation and restructuring

Companies are aiming for more transformational change and many are focused on achieving that transformation during the transaction.

  • More than half (53%) of the companies surveyed have restructured (including changes to working capital, reorganization, cost reduction, and legal entity restructuring) since the beginning of the pandemic.
  • 44% say they are considering restructuring over the next 12 months.
  • The most common reasons for restructuring were digital transformation, process simplification, and automation. Nearly two-thirds (63%) of respondents report that the success of their M&A activity is moderately or highly dependent on a successful transformation.
  • 34% of surveyed companies say they are implementing transformational restructuring while their deals are underway.

M&A looks to the future

As deal activity and volume stay robust, dealmakers continue to embrace new ways to get the work done. Data and analytics capabilities continue to make inroadsinto processes like diligence and monitoring.

  • 69% of respondents report they are using data analytics in their diligence and monitoring right now.
  • 27% are considering adding those capabilities.

Digital tools and virtual settings are gaining prominence in M&A deals, with mutually reinforcing effects that have the potential to speed up and alter the process.

Playing both sides of the ball

Depending upon the pressure they are under and the amount of room they have to act, many companies are approaching M&A strategy through the lens of offensive and defensive strategies. Evaluating moves this way can help determine whether a company needs to protect the position it has, seek gains, or aim for transformative progress. This year, respondents indicated their organizations are moving to put in place more offensive strategies.

“The trends we are seeing in this very active market indicate that we are just at the start of the next M&A run.” –Trevear Thomas, US leader for Mergers, Acquisitions, & Restructuring Services,
Deloitte Consulting LLP

Looking to the future of M&A: What is next?

On one level, our 2022 M&A Trends Report is a still photo of a moving subject. It finds decision-makers across a host of major sectors sensitive to new pressures, energetic in crafting responses and focused on moving forward—not backward—to meeting the future and its pressures with more vigorous solutions, not by retrenching. On another level, it’s a chronicle of shifts that may become permanent—or, at the least, that show every sign of continuing to move along their present trajectories.

We are not in a "post"-COVID world yet, and the world is coming to terms with the fact that this new reality has impacted much of how business is conducted and has created challenges to which dealmakers have learned to adapt. M&A has always been a useful tool to help companies grow, reach, and achieve beyond their present-day organic means. The more challenging the environment becomes, the more vital M&A will be.

About the survey

Between August 26 and September 7, 2021, a Deloitte survey conducted by ONResearch, a market research firm, polled precisely 1,300 executives—1,050 at US-headquartered corporations and 250 at domestic-based private equity firms—to gauge their expectations for M&A activity in the upcoming 12 months as well as their experiences with recent transactions.

All survey participants work either for private or public companies with revenues in excess of $10 million or for private equity firms. The participants hold senior ranks (director level or higher at the corporations). More than half of all respondents sit within the C-suite. This year, more respondents were owners, CEOs, directors, and vice presidents with fewer CFOs. All respondents are involved in M&A activity.

The corporate respondents represent a variety of industries: technology, consumer, energy, financial services, and life sciences among them. The majority of corporate respondents (72%) work for privately held companies. More than a quarter (29%) work at a company with more than $1 billion in revenue, and 15% work in a company with revenue less than $250 million. The rest are in the middle. The private equity respondents are in firms with a variety of different size primary funds: 40% of respondents were in the $1 billion to $3 billion range, up 19% from last year, with close to a third (32%) of respondents working at funds with more than $3 billion in assets. Only 8% work at funds with less than half a billion dollars to invest.

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