16 February 2024

A new edition of the M&A index is being prepared

The new Index will be released in February/March and will provide a comprehensive overview for the full year 2023. However, we can already note that our previous forecast for total M&A activity in Q4 2023 was only 2.9% higher than reality.

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Global politics continues to stifle markets. The conflict between Ukraine and Russia remains unresolved and could reach a stalemate. China continues to have ambitions to invade Taiwan and tensions in the Middle East have increased as a result of the conflict between Israel and Hamas. While the impact of these geopolitical events on financial markets, supply chains, oil and other commodity prices remains unclear, the global economy is certainly becoming more fragmented.

Against a backdrop of rising global conflicts and political tensions, coupled with tight monetary policy, 2023 has evolved as a period of consolidation that has effectively averted a looming economic recession. Relatively stable commodity prices played a key role in supporting disinflationary tendencies throughout the year. However, households and many businesses, particularly in Germany and the Central and Eastern Europe (CEE) region, faced persistent challenges that constrained household consumption - the main driver of economic growth.

Data released by Capital IQ shows that the number of transactions increased from 2,522 in Q3 to 2,551 in Q4, an increase of approximately 3% over the period. The total value of transactions (measured as the sum of the value of transactions completed in the last twelve months) decreased from $486.6 billion to $442.4 billion. The overall decline in market activity can be attributed to higher interest rates, continued geopolitical tensions and a generally negative economic outlook in Europe.

In addition to the forecast, the new comprehensive edition of the index will include macroeconomic analysis, a comprehensive overview of debt markets, a summary of equity markets, an assessment of headwinds and tailwinds affecting M&A markets and an outlook for this year.