• About
  • Subscribe
  • Contact
Wednesday, April 30, 2025
    Login
FutureCFO
  • Business Insights
    • Competencies and Capabilities
    • Digital Transformation
    • Leadership and Roles
    • Mergers and Acquisitions
    • Risk and Regulation
    • Strategies and Tactics
  • Operations
    • Audit and Compliance
    • Finance Accounting and Reporting
    • Operational Accounting and Control
    • Tax Management and Optimization
    • Treasury and Cash Management
  • Technology
    • Artificial Intelligence
    • Automation
    • Big Data
    • Blockchain
    • Business Applications
    • Cloud, Platforms and Ecosystems
    • Future Technology
  • Resources
    • Whitepapers
    • PodChats
    • Videos
  • Events
  • Awards
  • Knowledge Hub
    • Sustainable Finance
No Result
View All Result
  • Business Insights
    • Competencies and Capabilities
    • Digital Transformation
    • Leadership and Roles
    • Mergers and Acquisitions
    • Risk and Regulation
    • Strategies and Tactics
  • Operations
    • Audit and Compliance
    • Finance Accounting and Reporting
    • Operational Accounting and Control
    • Tax Management and Optimization
    • Treasury and Cash Management
  • Technology
    • Artificial Intelligence
    • Automation
    • Big Data
    • Blockchain
    • Business Applications
    • Cloud, Platforms and Ecosystems
    • Future Technology
  • Resources
    • Whitepapers
    • PodChats
    • Videos
  • Events
  • Awards
  • Knowledge Hub
    • Sustainable Finance
No Result
View All Result
FutureCFO
No Result
View All Result
Home Business Insights

M&A deal value: 2022 could be the second-strongest year

FutureCFO Editors by FutureCFO Editors
July 13, 2022
money

Photo by GeorgePeters on iStock

When it comes to strategic M&A deal value, 2022 could be on track to reach US$4.7 trillion by year-end despite a cooling pace of dealmaking in the first half of the year, said Bain & Company recently.

While this would represent a 20% decline from 2021’s record-breaking $5.9 trillion, it would still make 2022 the second-best year for dealmaking on record, the firm noted.

The company said its estimates for a strong market are due in part to the rebound in deal activity in recent months, with market leaders using this time of turbulence to improve competitive positions. 

In the first quarter of 2022, M&A deal value totalled only $599 billion, a steep drop from fourth-quarter 2021’s $970 billion, Bain said. 

However, the second quarter of 2022 brought with it a healthy recovery, with deal value totalling $702 billion in April and May.

“The keyword for dealmakers this year has been turbulence, as inflation has soared, interest rates have continued to rise, and the cost of capital has increased, not to mention mounting supply chain issues and geopolitical tensions,” said David Harding, an advisory partner at Bain & Company. 

Such an environment makes it easy to overlook the fundamentals that still exist for robust M&A opportunities, he pointed out.

“Capital is generally available for deals, most businesses have strong cashflow and balance sheets, and private equity pockets remain deep, Harding said. “We’re seeing market leaders continue to do M&A to add much-needed capabilities amid these turbulent times.”

Unprecedented volatility
A sign of this year’s unprecedented volatility — oscillating valuations, Bain observed.

The year 2021 saw record deal valuations, with median enterprise value/EBITDA multiples at 15.4 times, the firm said. 

Looking deeper at 2022, valuations stumbled in the first quarter, down to just 11 times, only to rebound in the second quarter to 16.7 times, the firm added.

“In the face of such turmoil, it’s easy for dealmakers to get conservative, but that would be a mistake,” said Andrei Vorobyov, a partner at Bain & Company. 

“Our research shows that the greatest competitive market shifts take place during times of turbulence,” Vorobyov noted. “Companies that invest throughout the economic cycle have the opportunity to help set the shape of their industries for years to come and realize far superior returns than those that participate sporadically.”

Bain said its study of nearly 3,900 companies revealed that recession winners average 14% in compounded annual EBIT growth in the 13 years following a downturn, compared with zero for recession losers. 

As the winners adjust their corporate strategies for times of uncertainty, they continue to use M&A as one of the big levers to gain and strengthen their competitive advantage, Bain added.

Companies willing to act must start with revising their M&A playbooks and deploying scenario planning so that executives have a clear view of the full range of potential outcomes, the firm advised.

Related:  Gartner: 40% of boards to have dedicated cybersecurity committee by 2025
Tags: Bain & CompanyM&A
FutureCFO Editors

FutureCFO Editors

No Result
View All Result

Recent Posts

  • Modernising Days Sales Outstanding (DSO) for 2025
  • A Day in the Life: Shelly Maneth from Red Hat Asia Pacific
  • Singapore Inc: Expanding horizons in ASEAN and beyond
  • Technology essentials for the modern CFO
  • Transforming budgeting through automation

Categories

  • Artificial Intelligence
  • Audit and Compliance
  • Automation
  • Big Data
  • Blockchain
  • Business Applications
  • Business Insights
  • Case Studies
  • Cloud, Platforms and Ecosystems
  • Competencies and Capabilities
  • Digital Transformation
  • eBooks and eBriefs
  • ESG and sustainability
  • Finance Accounting and Reporting
  • Future Technology
  • General
  • Infographics
  • Leadership and Roles
  • Mergers and Acquisitions
  • Operational Accounting and Control
  • Operations
  • Polls and Surveys
  • Resources
  • Risk and Regulation
  • Strategies and Tactics
  • Tax Management and Optimization
  • Technology
  • Treasury and Cash Management
  • Videos/Tutorials
  • Webcasts/Podcasts
  • White Papers

Strategic Insights for Finance Executives

FutureCFO.net is about empowering the CFO and the Finance Team to take on the leadership position in the digitalization of the enterprise. It's more than just a portal for the exchange of industry best practices, it is about creating and growing a community of finance professionals able to share learned experiences, providing a platform for the current and next generation of finance leaders and professionals.

Quick Links

  • Videos
  • Resources
  • Subscribe
  • Contact

Cxociety Media Brands

  • FutureIoT
  • FutureCFO
  • FutureCIO
  • Privacy Policy
  • Terms of Use
  • Cookie Policy

Copyright © 2022 Cxociety Pte Ltd | Designed by Pixl

Login to your account below

or

Not a member yet? Register here

Forgotten Password?

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
No Result
View All Result
  • Business Insights
    • Competencies and Capabilities
    • Digital Transformation
    • Leadership and Roles
    • Mergers and Acquisitions
    • Risk and Regulation
    • Strategies and Tactics
  • Operations
    • Audit and Compliance
    • Finance Accounting and Reporting
    • Operational Accounting and Control
    • Tax Management and Optimization
    • Treasury and Cash Management
  • Technology
    • Artificial Intelligence
    • Automation
    • Big Data
    • Blockchain
    • Business Applications
    • Cloud, Platforms and Ecosystems
    • Future Technology
  • Resources
    • Whitepapers
    • PodChats
    • Videos
  • Events
  • Awards
  • Knowledge Hub
    • Sustainable Finance
Login

Copyright © 2022 Cxociety Pte Ltd | Designed by Pixl

Subscribe