Citizens Financial Group recently conducted its 2024 M&A Outlook survey, revealing a strong sense of optimism and interest in artificial intelligence (AI) and international deals among middle-market companies and private equity firms in the United States. The survey, which involved 400 leaders at U.S. middle-market companies and private equity firms, highlighted the positive outlook for dealmaking activity, with 46% of participants expecting a strong M&A market in 2024. PE firms were even more positive, with 52% seeing strength in the current M&A market.
One of the notable trends uncovered by the survey was the increasing interest in AI assets. Among the PE firms who anticipated higher deal flow in 2024, 80% stated that they expect to buy more than they did in 2023, with a quarter specifically seeking AI assets to add to their portfolio. Furthermore, after four years of declining expectations, both buyers and sellers expressed renewed interest in foreign deal partners. Among mid-market companies, 51% of sellers and 44% of buyers stated that they would consider international deals. PE firms also demonstrated heightened interest in international investment opportunities, with 55% expressing interest, compared to 37% the previous year.
The upcoming U.S. election was also identified as a potential driver for M&A activity. While political uncertainty often dampens dealmaking, the survey indicated that 41% of mid-market companies considered the pending election as a motivator for pursuing M&A in 2024. Conversely, only 25% believed that the election would discourage dealmaking.
The survey results reflect a sense of normalcy returning to the M&A environment, with companies across sectors recognizing new economic prospects and opportunities. Optimism is further bolstered by the expectation of an improving U.S. economy, with 46% of mid-market companies and 50% of PE firms anticipating better economic conditions in 2024. Such positive economic forecasts are encouraging participation in M&A activities, as 68% of those expecting an improving economy expressed likelihood of engaging in M&A this year.
Overall, the Citizens’ 2024 M&A Outlook highlights a strong sense of optimism and interest among middle-market companies and private equity firms in the United States. The survey indicates a positive outlook for dealmaking activity, fueled by expectations of a robust U.S. economy, increasing interest in AI assets, renewed enthusiasm for international deal partners, and the potential influence of the upcoming U.S. election. As economic conditions continue to improve, more assets are expected to come to market, attracting buyers and driving M&A activity.
Disclaimer: This article is generated by OpenAI’s language model.
