M&A in 2024 is expected to grow on an upward trajectory, marking the end of one of the worst M&A markets in a decade. The post-covid effect, high inflation rate, geopolitical uncertainty and high energy costs of 2023 had a great impact on M&A and investment banking.
However, with the last quarter, we began to see positive growth that many analysts believe will continue in 2024, with an increase in transactions globally. Global activity is finally beginning to stabilise with a steadier macroeconomic backdrop and the continued reopening of financing markets.
See the biggest M&A deals of 2023 here.
The 5 biggest M&A deals completed so far in 2024
5. Sekisui House acquisition of MDC Holdings
Deal value: $4.9Bn.
Japanese homebuilder Sekisui House has acquired Denver-based builder MDC Holdings for approximately $4.95 billion in cash. With this, they are to become the fifth biggest homebuilder in the US.
The acquisition of MDC will double Sekisui´s presence in the US to 16 states, boosting its goal of delivering 10,000 homes annually in overseas markets by 2025.
4. Sunoco acquisition of Nustar Energy
Deal value: $7.3Bn.
Sunoco has acquired fuel storage and pipeline operator, Nustar Energy, in a deal valued at $7.3 billion, including debt, to diversify its core business beyond the distribution of motor fuels.
The deal gives Sunoco Access to NuStar´s transportation and storage facilities, including 9,500 miles of pipeline and 63 terminals and exposure to the West Coast and Midwest of the US.
3. Chesapeake Energy merger with Southwestern Energy
Deal value: $7.4Bn.
Chesapeake Energy and Southwestern Energy have entered into an agreement to merge in an all-stock transaction. This operation is valued at $7.4 billion or $6.69 per share.
The merger will create a premier energy company underpinned by a leading natural gas portfolio adjacent to the highest demand markets, premium inventory, resilient free cash flow and an investment-grade quality balance sheet.
The combined company will be positioned to deliver affordable, lower-carbon energy to meet growing domestic and international demand with sustainable cash returns to shareholders.
2. HPE acquisition of Juniper Networks
Deal value: $14Bn.
Hewlett Packard Enterprise (HPE) and Juniper Networks, the leader in AI-native networks, have entered a definitive agreement. In this, HPE will acquire Juniper in an all-cash transaction for $40.00 per share. This equates to an equity value of approximately $14 billion.
The deal potentially positions HPE more competitively against Cisco Systems in the networking market while boosting its AI capabilities.
1. Synopsys acquisition of Ansys
Deal value: $35Bn.
Chip design software maker Synopsys, California, US, has acquired Ansys, Pennsylvania, US, in a $35 billion cash-and-stock deal.
Ansys shareholders will receive $197.00 in cash and 0.3450 shares of Synopsys common stock for each Ansys share. It is the biggest acquisition in the technology sector since Broadcom took over VMWare in November 2023.
Synopsys makes tools to design chips, complementing the software made by Ansys for the evaluation of larger electronic systems in which those chips end up. The transaction will create a competitive new player in the business software industry.
Interested in seeing the biggest deals of 2022?
Trends and Predictions for M&A in 2024
M&A in 2024: Goldman Sachs predictions
According to Goldman Sachs, we can expect to see some key themes for strategic M&A in 2024. There will be an increased focus on M&A as a strategic lever, especially from corporate acquirers.
In addition, 2024 will bring the return of sponsor deal-making –including on the sell-side. It also predicted activity growth across sectors such as technology and healthcare and in AI-driven M&A across industries.
Business models will continue to be simplified, and the volume surge in resources, energy transition and infrastructure will continue.
Finally, perhaps due to the easing of the post-covid effect, there will be an increase in cross-border M&A activity in 2024.
M&A in 2024: Forbes predictions
Forbes also forecasts an increase in M&A deals in the technology industry. Digital services and technological innovation are to become two of the most attractive verticals for M&A alongside the growth of AI.
Furthermore, with sustainability remaining a concern for investors and consumers, the focus on ESG could impact M&A. The global decarbonization process may also affect M&A in the energy and renewable energy sectors.
Forbes also shares insight on potential M&A trends in banking and financial services. We can see many Banks, Private Equity firms, wealth and investment management companies and Fintech businesses beginning to invest again. It is predicted that international organisations will look to expand their operations globally.
They will do so by acquiring smaller companies or competitors, allowing larger organisations to generate synergies and increase their profitability.
Moreover, the stronger US dollar and Swiss Franc could allow the US to be more proactive in M&A across Europe and in countries where the local currency Exchange has lost more than 20% in value, such as Turkey and in South America.
M&A in 2024: PWC’s M&A hot spots
Finally, PwC has suggested which sectors could be potential M&A hot spots in 2024.
Their list includes grocery retail, food and beverage, sustainability and recyclability, fashion, spending on pets and pet ownership, consumer health and hospitality and leisure. PwC UK´s Value Creation Transformation Survey also derived that «70% of business leaders expect to use M&A to accelerate adoption of technology and technology-related processes».
Furthermore, it predicts that 2024 will see the Middle East as a growth hub for M&A in transportation and logistics.
Final predictions for M&A in 2024
In conclusion, we can draw many similarities between the predictions of Goldman Sachs, Forbes and PwC.
By analysing each of these predictions, we can particularly expect to see growth in the technology, healthcare and hospitality sectors.
ONEtoONE anticipates an exciting year in M&A, especially with the industry on a growing trajectory.
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