Third Quarter Data Shows M&A Surge Continues

By Generational Group

11/08/2021

The title in a recent Reuters article sums up the current situation in the M&A industry quite well:

• Pandemic Recovery Fuels Deal Craze as Third-Quarter M&A Breaks All Records

Here are a few insights from the article that I thought would be good to provide you:

Global mergers and acquisitions hit new record highs in the third quarter as companies and investors shaped their post-COVID future through transformative deals while their advisers struggled to cope with transaction volumes never seen before.

Third-quarter volumes drove global M&A activity in the first nine months of 2021 to an unprecedented record of $4.33 trillion, overtaking an all-time annual peak of $4.1 trillion hit before the financial crisis in 2007 and forcing investment banks to hike pay for overworked and disgruntled junior staff.

Clearly buyers are incredibly active right now. Generational is experiencing the same trend. So far in 2021 the number of deals we have closed is UP 57% over the prior year – and 2020 was also a record year for our firm.

Interestingly we are encountering business owners at our Growth and Exit Conferences that are unaware that we are on a record-setting pace for M&A in 2021. We also meet business owners that are trying to “time” the market to leave when they will generate the greatest return on their investment.

Well, the time is right now! Keep in mind that it takes 9-15 months to typically close a transaction with a premium buyer. With planned interest rate hikes and proposed tax increases, the window to this seller’s market could be closing in the next two years. So, you can move now or wait for the next seller’s market 7-10 years from now.

I doubt given what your business has most likely gone through during the pandemic that you want to wait until then.

If the facts of the tremendous growth in M&A activity this year is news to you, I would highly recommend that you attend a Generational Growth and Exit Strategy Conference. You will come away with a significant amount of information that you can use to prepare your company for an eventual exit.

To learn more, call us at 972-232-1121 or visit our website, provide us with your contact information and will be in touch.

Carl Doerksen is the Director of Corporate Development at Generational Group.

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