Dealmakers: Mid-market M&A in Australia 2018

13 February 2018

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Mergermarket is pleased to present Dealmakers: Mid-market M&A in Australia 2018, published in association with Pitcher Partners.
2017 was one for the M&A record books, with dealmaking in Australia more than doubling (55%) from the previous year. The country’s mid-market accounted for 77% of total deals, increasing 18% from the previous year – and dealmakers anticipate continued upward momentum in 2018.
According to 78% of dealmakers, M&A in the mid-market – deals valued between AU$10m and AU$250m – anticipate growth in transactional volume in the year ahead. A further 22% say dealmaking will remain unchanged from current levels.
The findings are part of research conducted for Dealmakers: Mid-market M&A in Australia 2018. This report includes exclusive interviews and insights from M&A dealmakers, whose collected sentiment has helped paint a portrait of expectations for deal volumes, drivers and opportunity sectors for the year ahead.
Other key findings:
  • Top challenges: Gaining access to capital or financing, the valuation gap between buyer and seller, and volatility of equity markets to be the top challenges facing dealmakers in the mid-market in the year ahead
  • Mid-market divestitures: 28% of Australian mid-market M&A deals were divestitures (of noncore assets or business lines)
  • Cross-border dealmaking: Foreign inbound mid-market M&A increased 25% (139 deals worth AU$8bn) from totals in 2016, while Australian outbound M&A increased 7% (64 deals worth AU$4.3bn)
  • Deal flows: 85% expect increasing private equity deals and 72% say the same for foreign inbound M&A in the next 12 months
  • Sell-side drivers: 55% expect both favourable valuations and the divestiture of noncore assets or business lines to be the top sell-side drivers of Australian mid-market M&A in the next 12 months