Boom and Gloom? European M&A Outlook 2023

The report offers a comprehensive assessment of dealmaking sentiment in Europe’s M&A market and reflects the opinions of 330 corporates and PE firms based in Europe, the Americas and APAC about their expectations for the year ahead.

This year, against a challenging backdrop, deal makers are remarkably bullish. Despite economic headwinds, repercussions of the war in Ukraine, vendor/acquiror valuation gaps and a challenging financing environment, most respondents expect European M&A activity to increase over the next year and the majority have deals on the horizon.

Key findings of the report include:

• M&A expectation are running high: 73% of deal makers expect the level of European M&A activity to increase over the next 12 months, compared to just 53% last year. Almost all are currently considering M&A.
• Undervalued targets and distressed sales to drive activity: the biggest buy-side driver is expected to be the availability of undervalued deal targets, whilst on the sell-side it is expected to be distressed situations.
• Cost of financing will increase: 87% of deal makers expect financing to be tighter compared with 2021 – this includes 45% who expect it to be much harder.
• ESG rises up the M&A agenda: 90% of respondents expect ESG scrutiny in their dealmaking to increase over the next three years, compared to 72% in 2021’s survey.

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