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Australian M&A outlook: New optimism in 2024

Our new survey Dealmakers: Australia mid-market M&A outlook 2024, published in association with Pitcher Partners, shows most global dealmakers will increase investments in Australia as the market once again proves resilient.

Respondents in our survey this year are sending strong and clear signals that Australia will remain a priority market for their M&A strategies. Almost all (95%) say they are searching for deal opportunities in Australia. And 70% say they will increase M&A in Australia over the next 12 months.

In particular, the Australian mid-market (deals valued between AU$10m and AU$250m) is capturing investors’ eyes. Mature mid-market companies in established industries offer stability and steady growth prospects, while those on the cutting edge of innovation (new tech and renewable energy), present opportunities for growth capital to scale their operations.

In that vein, 83% plan to increase their investments in the mid-market through 2024. An equal number say Australia’s mid-market opportunities are superior or at least equal to those in other regional and global markets.

The bottom line is that Australian M&A activity appears primed for a significant uptick in dealmaking if favourable conditions increase. While risks exist as always, the underlying appetite for deals in Australia remains voracious.

Key highlights include:

  • Improving outlook: 85% of respondents say M&A conditions in Australia will get better in 2024.
  • Positive barometer: Respondents give Australia a 77% confidence score when rating the current environment for M&A, based on the ease of doing deals, sourcing opportunities and other factors – this was an improvement on the 75% score in 2023.
  • Digital drives deals: Almost a third (30%) say digital transformation is the main deal driver when completing M&A in Australia.
  • Rising competition: 85% see increasing competition for assets as a dominant theme for the Australian market, a jump of 53% from 2022, as interest from global and domestic dealmakers grows significantly stronger.
  • Top challenges: 52% say deal financing will be their primary challenge, compared to 40% in 2023. Almost half (48%) also point to rising interest rates as a key obstacle – although noticeably less than the 55% who said likewise last year.

The report is also available at www.pitcher.com.au/dealmakers-2024/